An Indian national has pleaded guilty to a $227 million Medicare fraud scheme in which hundreds of thousands of American beneficiaries had their personal information purchased and used to file fraudulent claims for COVID-19 test kits that were never delivered.
Syed Murtuza Kablazada, 36, an Indian national living in Des Plaines, Illinois, admitted to participating in the scheme, which defrauded the federal Medicare program of approximately $136 million, according to the U.S. Department of Justice.
Court documents show that Kablazada and his co-conspirators acquired three Chicago-area laboratories, Chicago Care, V Care and Al-Ameer, over a six-month period beginning in January 2023. The laboratories were subsequently used to submit fraudulent Medicare claims for over-the-counter COVID-19 test kits.
To carry out the operation, Kablazada paid approximately $11 million to a purported telemarketing company based in Pakistan to obtain personally identifiable information belonging to hundreds of thousands of Medicare beneficiaries.
The information was then used to submit $227 million in claims to Medicare for COVID-19 test kits that beneficiaries had neither requested nor received. Medicare paid approximately $136 million of those fraudulent claims.
Investigators said the defendants also took steps to conceal their involvement and move the proceeds of the operation. Kablazada and his co-conspirators allegedly used overseas money transfers and unlicensed money transmitters to pay themselves. Some of the money was spent on luxury vehicles.
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As part of his plea agreement, Kablazada has agreed to forfeit more than $46 million in fraud proceeds that law enforcement officials seized from 10 bank accounts.
Kablazada pleaded guilty to two counts of health care fraud. He faces a maximum sentence of 20 years in prison. His sentencing date has not yet been announced. A federal district court judge will determine the final sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The case was investigated by the FBI’s Chicago Field Office and the Department of Health and Human Services Office of Inspector General (HHS-OIG).
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division, FBI Chicago Special Agent in Charge Ryan Whalen, and HHS-OIG Special Agent in Charge Thomas Ethridge announced the guilty plea.
Deputy Chief Patrick Mott and Trial Attorney Claire Sobczak Pacelli of the Justice Department’s Fraud Division, Health Care Fraud Section, are prosecuting the case. Assistant U.S. Attorney Andres Almendarez of the Northern District of Illinois also assisted with the investigation and prosecution.
The case comes as the Justice Department steps up its efforts to investigate fraud involving federal benefit programs. On April 7, the department announced the creation of its Fraud Division, which is focused on investigating and prosecuting individuals and organizations accused of defrauding the American public.
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The division’s work is part of President Donald Trump’s Task Force to Eliminate Fraud, a government-wide initiative chaired by Vice President JD Vance to address fraud, waste and abuse in federal benefit programs.
The Justice Department’s Health Care Fraud Strike Force Program has also continued its crackdown on health care fraud. Since its launch in 2007, the program, which currently operates through nine strike forces across federal districts, has charged more than 6,200 defendants accused of collectively billing federal health care programs and private insurers for more than $45 billion.
Meanwhile, the Centers for Medicare & Medicaid Services, working with HHS-OIG, are taking additional steps to hold health care providers accountable for their involvement in fraudulent billing schemes.