Detroit Resident Sentenced to Seven Years for Medicare Fraud

Tariq Mahmud, owner of Detroit-area Comprehensive Rehabilitation Services Inc. (CRS), has been sentenced to seven years in prison for leading a $3 million Medicare fraud scheme, according to the Justice Department. Mr. Mahmud will also serve three years’ supervised release and, jointly and severally with his co-defendants, must pay restitution of $1.8 million.

On February 2, 2012, Mr. Mahmud was convicted in federal district court of six counts of health care fraud and one count of conspiracy to commit health care fraud. The indictment against Mr. Mahmud and four co-defendants were part of a national Medicare fraud takedown. Mr. Mahmud’s co-defendants all pleaded guilty and were already sentenced.

The evidence at trial showed that Mr. Mahmud’s rehabilitation agency was a fraud. From January 2003 to February 2007, CRS bought falsified patient files from over 30 rehabilitation and therapy agencies and used the files to file over $3 million in false claims against Medicare.

To further the scheme, Medicare recipients received cash kickbacks and prescription drugs in exchange for signing forms and visit sheets. The documents were then falsified to indicate that the patients received therapy services that they never actually received. Occupational and physical therapists fabricated evaluations, progress notes, and discharge papers for patients they never met to document therapy services that were never actually provided.

In addition to the $3 million in false claims Mr. Mahmud submitted to the Medicare program, he made false statements to Medicare to cover up the scheme. For example, when Medicare contacted Mr. Mahmud about a beneficiary who said he did not receive the billed services from CRS, Mr. Mahmud returned the Medicare payment, telling Medicare that he had learned from his staff that the patient was not satisfied with CRS’s services. The truth was that CRS had no professional staff, and no services at all had been provided to the beneficiary. In fact, the beneficiary’s identity had been stolen and used to make false claims against Medicare.

Medicare fraud can be difficult to identify, and whistleblowers—especially employees of companies involved in such fraud—can provide valuable information to the government. The qui tam provisions of the False Claims Act allow whistleblowers with information about fraud against the government to file a lawsuit on behalf of the government. If the lawsuit results in a recovery for the government, the whistleblower is entitled to share in the recovery.

Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.

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