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The Department of Justice today announced criminal charges against 18 defendants in nine federal districts across the United States for their alleged participation in various fraud schemes involving health care services that exploited the COVID-19 pandemic and allegedly resulted in over $490 million in COVID-19 related false billings to federal programs and theft from federally funded pandemic programs.

In connection with the enforcement action, the department seized over $16 million in cash and other fraud proceeds. The Center for Program Integrity of the Centers for Medicare & Medicaid Services (CPI/CMS) separately announced today that it took adverse administrative actions in the last year against 28 medical providers for their alleged involvement in COVID-19 schemes.

“The Justice Department will not tolerate those who exploited the pandemic for personal gain and stole taxpayer dollars,” said Attorney General Merrick B. Garland. “This unprecedented enforcement action against defendants across the country makes clear that the Department is using every available resource to combat and prevent COVID-19 related fraud and safeguard the integrity of taxpayer-funded programs.”

“Today’s announcement marks the largest-ever coordinated law enforcement action in the United States targeting health care fraud schemes that exploit the COVID-19 pandemic,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The Criminal Division’s Health Care Fraud Unit and our partners are committed to rooting out pandemic-related fraud and holding accountable anyone seeking to profit from a public health emergency.”

Today’s announcement builds on the successes of the April 2022 COVID-19 Enforcement Action and the May 2021 COVID-19 Enforcement Action and involves the prosecution of various COVID-19 health care fraud schemes.

“The charges announced today demonstrate the FBI’s, along with its partner’s, commitment to ensuring that COVID-19 health care fraud does not go unpunished,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “During the Covid pandemic, programs were put in place to help the American people, and we will continue to ensure that the individuals that took advantage of those programs face justice.”

In one of the most significant types of COVID-19 health care fraud schemes announced today, multiple defendants were charged with defrauding the Health Resources and Services Administration (HRSA) COVID-19 Uninsured Program. The Uninsured Program was designed to prevent the further spread of the pandemic by providing access to uninsured patients for testing and treatment. The Uninsured Program was also designed to provide financial support to health care providers fighting the COVID-19 pandemic by reimbursing them for services provided to uninsured individuals. The Uninsured Program ultimately ceased operating due to the exhaustion of funding.

“Exploiting the COVID-19 pandemic and viewing the public health emergency as an opportunity to steal money and resources from federal health care programs shows a clear disregard for the well-being and safety of those who rely on government-funded health care services,” said Inspector General Christi A. Grimm of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “As today’s enforcement action demonstrates, HHS-OIG and our partners remain steadfast in our commitment to protecting critical public health measures from fraud.”

 

Eastern District of Louisiana

• Melissa J. Watson, 50, of Slidell, Louisiana, was charged by indictment with theft of public money, wire fraud, and money laundering in connection with an alleged scheme to misappropriate over $1.1 million in funds from the Provider Relief Fund (PRF), administered by HRSA, and the EIDL Program, administered by the Small Business Association (SBA), for the enrichment of herself and others. According to the indictment, Watson, who operated a primary care clinic and a purported spa prior to the onset of the COVID-19 pandemic, caused the submission of false and fraudulent loan agreements, attestations, and other documentation, on behalf of her clinic to HRSA and the SBA. Watson then allegedly used the PRF and EIDL Program funds, not as falsely attested, but for personal gain, including making numerous cash withdrawals, and purchasing, among other things, two luxury vehicles, hundreds of thousands of dollars in real estate, a boat, a trailer, a time share, and multiple luxury vacations. The government seized over $500,000 in bank accounts held by Watson, and several assets, including a boat, trailer, and Range Rover Sport. The case is being prosecuted by Trial Attorney Kelly Z. Walters of the Gulf Coast Strike Force and Assistant U.S. Attorney Nicholas Moses of the U.S. Attorney’s Office for the Eastern District of Louisiana.

Middle District of Louisiana

• Adolphus A. Obioha, 64, of Baton Rouge, Louisiana, was charged by indictment with wire fraud and money laundering in connection with an alleged scheme to fraudulently obtain over $425,000 in funds under the EIDL Program. According to the indictment, Obioha, who operated a medical transport business prior to the onset of the COVID-19 pandemic, submitted multiple fraudulent loan documents to the SBA. Obioha allegedly used the EIDL Program funds to purchase a rental property and personal vehicle and to wire nearly $175,000 overseas. The government seized a total of $136,234.09 from multiple bank accounts held by Obioha. The case is being prosecuted by Assistant Chief Justin M. Woodard of the Gulf Coast Strike Force and Assistant U.S. Attorney Caroline B. Gardner of the U.S. Attorney’s Office for the Middle District of Louisiana.

Western District of Louisiana

• Shaquaila Lewis, a/k/a Shaquaila Lewis-Chatman, 35, of Gibsland, Louisiana, was charged by indictment with wire fraud and money laundering in connection with an alleged scheme to fraudulently obtain over $1.1 million in funds under the PPP and EIDL Program. According to the indictment, Lewis, a registered nurse, caused the submission of numerous fraudulent loan applications that contained false statements regarding a purported business and the intended use of the loan funds. The funds were allegedly used for personal expenses, such as gambling and contracting work on her home. The case is being prosecuted by Assistant Chief Justin M. Woodard of the Gulf Coast Strike Force and Assistant U.S. Attorney Seth D. Reeg of the U.S. Attorney’s Office for the Western District of Louisiana.

Today’s enforcement action was led and coordinated by Assistant Chiefs Justin M. Woodard and Debra Jaroslawicz and Trial Attorney D. Keith Clouser of the Criminal Division’s Fraud Section. The Health Care Fraud Unit’s Strike Forces in Brooklyn, the Gulf Coast, Los Angeles, and Tampa; the National Rapid Response Strike Force; and the U.S. Attorneys’ Offices for the Central District of California, Middle District of Florida, Eastern District of Louisiana, Middle District of Louisiana, Western District of Louisiana, Eastern District of New York, District of Puerto Rico, District of Utah, and Western District of Washington are prosecuting these cases, with assistance from the Health Care Fraud Unit’s Data Analytics Team. Descriptions of each case involved in today’s enforcement action are available on the department’s website at www.justice.gov/criminal-fraud/health-care-fraud-unit/2023-case-summaries.

In addition to the FBI and HHS-OIG, the Small Business Administration Office of Inspector General, Defense Criminal Investigative Service, Internal Revenue Service Criminal Investigation, Treasury Inspector General for Tax Administration, Homeland Security Investigations, Department of Homeland Security Office of Inspector General; Department of Defense Office of Inspector General, AMTRAK Office of Inspector General, California Department of Health Care Services, and other federal and state law enforcement agencies participated in the law enforcement action.

The Health Care Fraud Strike Force is part of a joint initiative between the Department of Justice and HHS to prevent and deter health care fraud and enforce current anti-fraud laws around the country. In the past three years, the Health Care Fraud Strike Force has rooted out health care fraud related to the COVID-19 pandemic. To date, 53 defendants have been charged in nationwide COVID-19 Health Care Fraud Enforcement Actions for causing over $784 million in loss associated with the pandemic, and 20 defendants have been convicted.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit www.justice.gov/coronavirus.

The Department of Justice needs the public’s assistance in remaining vigilant and reporting suspected fraudulent activity. To report suspected fraud, contact the National Center for Disaster Fraud (NCDF) at (866) 720-5721 or file an online complaint at www.justice.gov/disaster-fraud/webform/ncdf-disaster-complaint-form. Complaints filed will be reviewed at the NCDF and referred to federal, state, local, or international law enforcement or regulatory agencies for investigation.

An indictment, complaint, or information is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.