Dozens Nabbed in International $100M Medicaid-Fraud Ring - NBC New York

Dozens Nabbed in International $100M Medicaid-Fraud Ring



    Dozens Nabbed in International $100M Medicaid-Fraud Ring

    Autopsy doctors billing Medicare for colonoscopies? Gynecologists billing medicare for skin exams?

    The FBI said it was all part of a $100 million dollar Medicare fraud run by an Eurasian gang. More than 40 suspects were arrested Wednesday for allegedly stealing the identities of thousands of Medicare patients as well as doctors to submit bogus billings.

    U.S. attorney Preet Bharara said the gang did not care what kind of doctor was billing for what kind of patient or procedure, they just submitted names and codes and collected the cash. 

    "This criminal organization opened more than 118 bogus medical clinics in 25 different states," Bharara said.  "Most were nothing more than shams, shells and storefronts."

    The FBI said the gang is made up of Armenian-Americans called the "Mirzoyan-Terdjanian Organization,"  named for two of its reputed leaders.

    The suspects are charged with extortion, credit card fraud, identity theft and racketeering.  "It puts an end to the largest Medicare fraud ever committed by a single criminal enterprise," New York FBI Director Janice Fedarcyk said.

    Police said a worker at Lutheran Hospital helped in the scam.  He allegedly accessed hospital databases and gave that information to members of the gang.  This was just one of several health facilities where the FBI said insiders helped in the scam.

    In Coney Island and Long Island City, the FBI raided several locations.  In one, NYPD Commissioner Ray Kelly said one worker filled out bogus claims around the clock and had Medicare send payments to bank accounts with fictitious names.

    Prosecutors said another part of the scheme was for the group to stage bogus car accidents and have patients undergo bogus treatments in order to rip off insurance companies.

    The operation was under the protection of an Armenian crime boss, known in the former Soviet Union as a "vor," prosecutors said. The reputed boss, Armen Kazarian, was in custody in Los Angeles.

    Bharara said it was the first time a vor — "the rough equivalent of a traditional godfather" — had been charged in a U.S. racketeering case.

    Kazarian and his followers are also accused of threatening violence to keep the criminal ring running smoothly.

    "The indictment talks about phantom doctors, fancy cars, money laundering through Vegas casino chips, threats to disembowel rivals, and more," Bharara said. 

    More than 20 suspects were charged in New York.  Others were arrested in Los Angeles, Miami and Atlanta.