2 Charged In $227 Million COVID Test Medicare Fraud Scheme: Authorities

CHICAGO — Two west suburban men face charges in connection with a $227 million Medicare fraud scheme involving coronavirus test kits, authorities said.

Syed Murtuza Kablazada, 34, of Arlington Heights, and Syed Mehdi Hussain, 32, of Carol Stream, were arrested Wednesday and are both charged with four counts of health care fraud, according to the U.S. Department of Justice.

The pair ran purported medical laboratories that submitted fraudulent claims to Medicare for reimbursement of over-the-counter COVID-19 test kits, but they rarely gave the kits to Medicare beneficiaries, instead submitting claims for people who had not requested kits, some of whom were dead, authorities said.

They also installed foreign nationals to act as nominee owners at the laboratories to submit fraudulent claims to Medicare for the test kits, with the understanding the nominee owners would flee the country when they learned their laboratory was under investigation, according to the department.

Between September 2022 and June 2023, the labs billed Medicare about $227 million in fraudulent claims, of which Medicare paid about $136 million in reimbursements, authorities said.

"The overwhelming fraud uncovered in this investigation details a blatant disregard for America's critical health care program, Medicare, and puts all patients at risk," Special Agent in Charge Douglas DePodesta, of the FBI Chicago Field Office, said in a news release.

If convicted, Kablazada and Hussain face up to 10 years in prison for each count, according to the department.