Federal prosecutors have charged an Illinois laboratory owner with running a large-scale scheme to submit claims for COVID-19 tests that were never performed, according to the U.S. Department of Justice.
Rajesh "Raj" Patel, 52, of Schaumburg, faces five counts of wire fraud. Prosecutors allege the laboratory billed the U.S. Health Resources and Services Administration (HRSA) Uninsured Program for at least 380,000 nonexistent tests between May 2021 and April 2022.
How the alleged scheme worked
HRSA is a federally funded program that covered the costs of COVID-19 tests for individuals without health insurance coverage.
According to the Justice Department, the laboratory paid tens of millions of dollars to a staffing company for patient specimens and data that often did not exist, then generated false negative results to support the claims.
Claim totals and payments
The laboratory submitted $66.2 million in fraudulent claims to HRSA, and the agency paid out about $44.1 million on the fraudulent submissions, with Patel personally receiving roughly $28 million, prosecutors said.
Penalties and investigation
Each wire fraud count carries a maximum penalty of 20 years in prison if convicted.
Assistant Attorney General Colin M. McDonald said the defendant allegedly exploited a global crisis for personal gain by fabricating hundreds of thousands of COVID-19 tests and then billing the taxpayer for them.
"Every dollar taken from a federal health care program is a dollar taken from the American people," McDonald said. "The Fraud Division will find those who steal from taxpayers, and we will prosecute them."
The FBI Chicago Field Office and HHS-OIG conducted the investigation.
