A federal grand jury in the Northern District of Illinois returned an indictment yesterday charging Rajesh “Raj” Patel, 52, of Schaumburg, Illinois, with a $66.2 million fraud scheme in which Patel allegedly billed for hundreds of thousands of COVID-19 tests that were never performed. “This defendant allegedly exploited a global crisis for personal gain, fabricating hundreds of thousands of COVID-19 tests – then billing the taxpayer for it,” said Assistant Attorney General Colin M. McDonald of the Justice Department’s Fraud Division.
Key details of the case
“Every dollar taken from a federal health care program is a dollar taken from the American people. The Fraud Division will find those who steal from taxpayers, and we will prosecute them.”. “Fighting financial fraud and holding accountable those who unlawfully obtain federal assistance for personal profit remains a top priority for the FBI,” said FBI Chicago Special Agent in Charge Ryan Whalen.
“Pandemic assistance programs were designed to provide a lifeline to vulnerable members of society. Those who are entrusted with federal healthcare dollars have a responsibility to bill honestly and accurately. The FBI and our partners will stop at nothing to ensure that those who deceive and steal taxpayer dollars for their own purposes face full justice.”.
“The COVID-19 pandemic required an unprecedented investment of public resources to protect the health and well-being of our communities. As alleged, this scheme exploited a federally funded program created to ensure uninsured individuals had access to critical testing services during a national emergency,” said Special Agent in Charge Thomas Ethridge of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).
Enforcement actions and official statements
In addition, “HHS-OIG is committed to holding accountable those who seek to profit through fraud and abuse of government health care programs. We will continue working closely with our law enforcement partners to protect taxpayer dollars and safeguard the integrity of programs designed to serve the public.”. According to court documents, Patel was the co-owner and Chief Operating Officer of a clinical laboratory located in Hillside, Illinois, that processed polymerase chain reaction (PCR) tests during the COVID-19 pandemic.
In around March 2021, Patel’s laboratory entered into an agreement with Meridian Medical Staffing Inc. (Meridian). The laboratory paid Meridian tens of millions of dollars for collecting test specimens and providing the laboratory with the specimens and biological information of the purported patients. In reality, many of these patients never existed or never provided test specimens to Meridian. For complete details, refer to the official DOJ press release.
Consequently, between May 2021 and April 2022, Patel allegedly created fake “negative” test results for at least 380,000 PCR tests on specimens provided by Meridian. The laboratory never actually performed these tests. Patel allegedly created the fake “negative” test results so that the laboratory could fraudulently bill the U.S.
Notably, health Resources and Services Administration (HRSA) Uninsured Program, a federally funded program that covered the costs of COVID-19 tests for individuals without health insurance coverage. Patel’s laboratory submitted approximately $66.2 million in fraudulent claims to HRSA as a result of Patel’s scheme. HRSA paid the laboratory approximately $44.1 million due to these fraudulent claims. For related coverage, see Leader of global violent extremist network ‘764’ pleads guilty to conspiracy to sexually exploit minors — DOJ.
Specifically, patel personally obtained approximately $28 million in proceeds from the scheme. . Patel is charged with five counts of wire fraud. If convicted, he faces a maximum penalty of 20 years in prison on each count.
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division (Fraud Division). Special Agent in Charge Ryan Whalen of the FBI Chicago Field Office; and Special Agent in Charge Thomas Ethridge of the Department of Health and Human Services Office of Inspector General (HHS-OIG) made the announcement. For related coverage, see Florida laboratory vice president and marketer convicted of medicare fraud for COVID-19 testing scheme — DOJ.
The FBI Chicago Field Office and HHS-OIG investigated the case. Trial Attorney Claire Sobczak Pacelli of the Fraud Division’s Health Care Fraud Section is prosecuting the case. On April 7, the Department of Justice announced the creation of the Fraud Division.
In particular, 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 nine 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.
Investigation and prosecution details
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.