New York Doctor Sentenced to 13 Years in Prison for Multi-Million Dollar Health Care Fraud

Wednesday, February 7, 2018

A New York surgeon who practiced at hospitals in Brooklyn and Long Island was sentenced today to 156  months in prison for his role in a scheme that involved the submission of millions of dollars in false and fraudulent claims to Medicare.

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue of the Eastern District of New York, Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office and Special Agent in Charge Scott Lampert of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Office of Investigations made the announcement.

Syed Imran Ahmed M.D., 51, of Glen Head, New York, was sentenced by U.S. District Judge Dora L. Irizarry of the Eastern District of New York, who also ordered Ahmed to pay $7,266,008.95 in restitution, to forfeit $7,266,008.95, and to pay a $20,000 fine.  Ahmed was convicted in July 2016 after an 11-day trial of one count of health care fraud, three counts of making false statements related to health care matters and two counts of money laundering.

“Medicare is a crucial program for many of the most vulnerable people in our society – American seniors and those with disabilities,” said Acting Assistant Attorney General Cronan.  “In this case, Syed Ahmed put his own greed ahead of the trust we put in our medical professionals, draining over $7 million in precious funding from our Medicare program.  His conviction and the sentence imposed in this case demonstrate the Department of Justice’s unwavering commitment to protecting public funds and the integrity of our health care system.”

“Dr. Syed Ahmed treated Medicare like a personal piggy bank, stealing over $7.2 million by making fraudulent claims for medical procedures he never performed,” stated U.S. Attorney Donoghue.  “Dr. Ahmed will now pay the price for violating the trust that Medicare places in doctors.  His 13-year prison sentence and the heavy payments imposed should send a powerful message of deterrence to other medical professionals who would seek to defraud vital taxpayer-funded programs like Medicare for personal enrichment.  This Office, together with our law enforcement partners, will remain vigilant in rooting out health care fraud.”

“Health care fraud is often billed as a victimless crime, but that couldn’t be further from the truth,” said Assistant Director in Charge Sweeney.  “Someone is always left to foot the bill. Insurers, the insured, and others are the ones who pay the price. Those who employ these schemes will most certainly be brought to justice, as we’ve proven here today.”

“The fraud scheme that Dr. Ahmed engaged in was motivated by pure greed,” said Special Agent in Charge Lampert.  “HHS OIG and our law enforcement partners will continue to aggressively pursue all those who seek to unlawfully enrich themselves by victimizing participants of the Medicare program.”

According to evidence presented at trial, Ahmed, a surgeon who practiced at Kingsbrook Jewish Medical Center and Wyckoff Heights Medical Center in Brooklyn, Franklin Hospital in Valley Stream, and Mercy Medical Center in Rockville Centre, New York, billed the Medicare program for incision-and-drainage and wound debridement procedures that he did not perform.  Ahmed wrote out lists of phony surgeries and sent the lists to his billing company in Michigan with instructions that they be billed to Medicare.  Ahmed also directed that the surgeries be billed as though they had taken place in an operating room so as to increase the payout for the fraudulent scheme, the evidence showed.

The evidence introduced at trial showed that Medicare paid over $7 million to Ahmed for fraudulent claims.

The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York.  Trial Attorney Debra Jaroslawicz of the Fraud Section, Assistant U.S. Attorney F. Turner Buford, formerly a Fraud Section trial attorney, and Senior Litigation Counsel Patricia Notopoulos of the Eastern District of New York are prosecuting the case.

The Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,500 defendants who have collectively billed the Medicare program for more than $12.5 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

SEC Announces Charges in Massive Telemarketing Boiler Room Scheme Targeting Seniors

Washington D.C., July 12, 2017—

The Securities and Exchange Commission today brought fraud charges against 13 individuals allegedly involved in two Long Island-based cold calling scams that bilked more than one hundred victims out of more than $10 million through high-pressure sales tactics and lies about penny stocks.

The SEC alleges that the orchestrators of the scheme used boiler room-style call centers to make hundreds of thousands of cold calls that included the use of threatening and deceitful sales techniques to pressure victims – many of whom were senior citizens – into purchasing penny stocks.  For example, as part of one such scam, a boiler room salesman allegedly claimed that the Walt Disney Company was buying into a purported media and internet company and that would cause the penny stock’s price to increase substantially.

During these calls, victims were allegedly harassed and threatened by sales personnel.  When one victim complained about his losses, a sales representative allegedly said, “I am tired of hearing from you.  Do you have any rope at home?  If so tie a knot and hang yourself or get a gun and blow your head off.”  According to the SEC’s complaint, in a typical phone call, telemarketers would direct victims to place trades and tell them how many shares to purchase and at what price.  With this information about the victims’ trades, the orchestrators and the boiler room sales personnel allegedly placed opposing sell orders to dump their own shares, realizing more than $14 million in illegal proceeds while the victims lost millions of dollars, including retirement savings.

SEC investigators learned of the alleged scheme from investor complaints and used technological tools and innovative investigative approaches to build evidence – within a matter of months from receiving the complaints – against the defendants who went to great lengths to evade detection.

“These kinds of scams cause devastating harm to investors,” said Stephanie Avakian, Co-Director of the SEC’s Enforcement Division.  “Investors must beware of the sort of conduct alleged in our complaint – things like unsolicited calls, high-pressure sales tactics, and promises that a no-name stock is going to skyrocket.”

Scott W. Friestad, Associate Director of the SEC’s Enforcement Division, added, “The defendants allegedly used boiler rooms and high-pressure sales tactics to swindle seniors into investing their life savings in microcap securities they were secretly manipulating for their own profit.  But, through a combination of technology and innovative investigative approaches, we were able to unravel the alleged scheme and prevent further investor harm.”

In a parallel action, the U.S. Attorney’s Office for the Eastern District of New York announced criminal charges.

The SEC’s complaint, filed in federal district court in Brooklyn, N.Y., charges all defendants with fraud and nine with market manipulation.  The SEC is seeking permanent injunctions, disgorgement with interest, civil penalties, penny stock bars, and an officer-and-director bar from one of the orchestrators of the scheme.  The complaint also names 27 individuals and entities that received proceeds from the fraud, as relief defendants.

The SEC’s complaint also charges certain defendants with acting as unregistered brokers.  The SEC encourages investors to check the backgrounds of people selling them investments by using the SEC’s website to quickly identify whether they are registered professionals.

The SEC’s investigation, which is continuing, has been conducted by Andrew Elliott and Cecilia Connor and assisted by Leigh Barrett.  The investigation was supervised by Scott Friestad and Amy Friedman.  The SEC’s litigation will be handled by Matthew Scarlato and James Smith and supervised by Jan Folena.  The SEC appreciates the assistance of the Financial Industry Regulatory Authority, Federal Bureau of Investigation, U.S. Attorney’s Office for the Eastern District of New York, British Columbia Securities Commission, Ontario Securities Commission, and Oregon Division of Financial Regulation.

The SEC encourages victims of the alleged fraud to contact [email protected] .  The SEC’s Office of Investor Education and Advocacy previously issued an alert warning investors that aggressive stock promotion is a red flag of fraud.

“Investors should be skeptical anytime they receive an unsolicited communication promoting a stock – it could be a part of a boiler room scheme,” said Lori Schock, Director of the SEC’s Office of Investor Education and Advocacy.  “If you receive a phone call from a high-pressure salesperson who uses harassment and threats to get your business, hang up.”