Two men were sentenced this week for their roles in a scheme to defraud Medicare, Medicaid, and private health insurance companies by submitting over $522 million in fraudulent claims for medically unnecessary genetic tests that were obtained through the payment of illegal kickbacks and bribes.
Reyad Salahaldeen, 57, of Buford, Georgia, was sentenced to 151 months in prison after pleading guilty to conspiracy to commit healthcare fraud and wire fraud.
Mohamad Mustafa, 28, of Duluth, Georgia, was sentenced to three years in prison after pleading guilty to paying healthcare kickbacks.
Court documents say that Salahaldeen controlled four laboratories, Express Diagnostics, LLC, in New Jersey; BioConfirm Laboratory USA, LLC and BioConfirm Laboratories, LLC, in Georgia; and Tox Management, LLC and Tri-State Toxicology, LLC, both in Texas.
From 2018 through August 2020, Salahaldeen and co-conspirators paid kickbacks and bribes to a network of purported “marketers” who targeted individuals covered by Medicare, Medicaid, and private insurance and induced them to provide their health insurance information and DNA samples to obtain costly genetic tests designed to predict the risk of cancer, adverse drug reactions, and other conditions.
The four laboratories billed about $522 million in false and fraudulent claims, of which Medicare, Medicaid, and private insurers paid approximately $84 million.
“Under the guise of health care, these two fraudsters attempted to steal more than half a billion dollars from taxpayers through a web of sham contracts, lies, and bribes,” said Colin M. McDonald, Assistant Attorney for the National Fraud Enforcement Division. “These schemes deplete America’s pocketbook and destroy the trust in medicine that patients deserve and demand. The Department of Justice will remain vigilant in our efforts to deter those defrauding the American people in the name of health care. I thank the prosecutors and our law enforcement partners at FBI and HHS-OIG who worked tirelessly for this just outcome.”
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The marketers obtained DNA samples through telemarketing, door-to-door solicitation, appearances at health fairs, and other methods of in-person solicitation. Further, the marketers, at the direction of Salahaldeen and co-conspirators and in exchange for kickbacks and bribes, obtained fraudulent laboratory requisition forms for the tests from medical providers who had not treated or consulted with the beneficiaries, and did not use the test results in treatment. As part of the scheme, Salahaldeen falsified laboratory requisition forms, letters of medical necessity, and other medical records to make the tests appear legitimate.
After the indictment was returned and he learned of the warrant for his arrest, Salahaldeen sought to evade law enforcement by traveling from North Carolina to Texas, where he attempted to enter Mexico. Salahaldeen was apprehended at the border when he falsely presented another person’s identification in a further attempt to evade arrest and prosecution.
Mustafa, who controlled Express and BioConfirm with Salahaldeen, participated in the scheme by paying kickbacks and bribes to various marketers to induce them to obtain DNA samples and fraudulent test requisition forms from medical providers. To conceal the scheme, Mustafa and Salahaldeen created sham contracts, invoices, and other documentation that disguised the illegal kickbacks and bribes as payments for purported marketing services.
In addition to the prison sentences, Salahaldeen was ordered to pay $84.5 million in restitution and to forfeit $3 million from two bank accounts, a 2019 GMC Yukon, and properties in Texas and Georgia. Mustafa was ordered to pay $64.3 million in restitution.
Eleven of Salahaldeen and Mustafa’s co-conspirators previously pleaded guilty in connection with this fraud scheme and were sentenced as follows:
- Travores Wills, a marketer, was sentenced to 46 months in prison
- Elijua Watson, a marketer, was sentenced to 27 months in prison
- Diego Pancha Valencia, a marketer, was sentenced to 26 months in prison
- Shauntae Walker, a nurse practitioner, was sentenced to 24 months in prison
- Cassandra Latham, a nurse practitioner, was sentenced to 21 months in prison
- LaTosha McCune, a marketer, was sentenced to 18 months in prison
- Vinit Patel, a medical doctor, was sentenced to 12 months in prison
- Jose Rodriguez Ospina, a medical doctor, was sentenced to 12 months in prison
- Edward Giles, a marketer, was sentenced to 12 months in prison
- Derek McCune, a marketer, was sentenced to 12 months in prison
- Nelson Giraldo, a medical doctor, was sentenced to 6 months of house arrest and 3 years of probation
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division; Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG); and Acting Special Agent in Charge Peter Ellis of the FBI’s Atlanta Field Office made the announcement.
HHS-OIG and FBI investigated the case.
Acting Principal Assistant Chief Rebecca Yuan and Acting Assistant Chief Gary A. Winters of the Criminal Division’s Fraud Section prosecuted the case.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division ('Fraud Division'). The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.
The Department of Justice’s Health Care Fraud Strike Force Program, currently comprised of eight strike forces operating in federal districts across the country, has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers more than $45 billion since 2007. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the Office of the Inspector General for the Department of Health and Human Services, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at www.justice.gov/criminal-fraud/health-care-fraud-unit.
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