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Fraud

Leader of $68M Adult Day Care Fraud Scheme Pleads Guilty

Strategic Insights

— 1 min read

Zakia Khan, the owner of two Brooklyn social adult day cares, pleaded guilty to conspiring to defraud Medicaid and pay health care kickbacks, orchestrating a massive scheme that stole over $68 million in welfare funds meant for vulnerable populations. The scheme involved bribing patients to bill a federal health care program, and Khan and her co-defendants used multiple business entities to launder the fraudulent proceeds.

Key Takeaways:

  • The scheme, led by Zakia Khan, involved defrauding Medicaid of over $68 million in welfare funds meant for vulnerable populations.
  • Khan and her co-defendants used bribes and kickbacks to refer Medicaid recipients to her social adult day cares, which billed the program for services not provided or induced by kickbacks.
  • The scheme spanned from approximately October 2017 to July 2024, with Khan and her co-defendants laundering the proceeds through multiple business entities.
  • Khan agreed to forfeit $5 million, including two properties, cash, and gold jewelry seized during a search of her home.
  • She pleaded guilty to conspiracy to commit health care fraud and conspiracy to defraud the United States and to pay and receive health care kickbacks.
  • Kumar faces a maximum penalty of 15 years in prison and is scheduled to be sentenced on Jan. 28, 2026.
  • The Health Care Fraud Strike Force Program, led by the Justice Department's Fraud Section, has charged over 5,800 defendants who collectively have billed federal health care programs and private insurers more than $30 billion since 2007.

Statistics:

  • Over $68 million in Medicaid funds were defrauded by Zakia Khan and her co-defendants.
  • The scheme spanned approximately 7 years, from October 2017 to July 2024.
  • Khan agreed to forfeit $5 million, including

+ 2 properties

+ Cash

+ Gold jewelry

  • Since 2007, the Health Care Fraud Strike Force Program has charged over 5,800 defendants who collectively have billed federal health care programs and private insurers more than $30 billion.
  • The Centers for Medicare & Medicaid Services, working with HHS-OIG, are taking steps to hold providers accountable for their involvement in health care fraud schemes.

Sources:

  • "Leader of $68M Adult Day Care Fraud Scheme Pleads Guilty" (August 6), Original text here: https://www.justice.gov/opa/pr/leader-68m-adult-day-care-fraud-scheme-pleads-guilty

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