Top federal officials on Thursday announced prosecutions against 15 defendants accused of defrauding government services.
Assistant Attorney General Colin McDonald, the head of the Department of Justice’s Fraud Enforcement Division, said the charges brought this week targeted “shocking” schemes that reaped $90 million in taxpayer funds.
McDonald said alleged fraudsters exploited programs meant to help vulnerable populations — including the now-defunct Housing Stabilization Services program, which was designed to connect homeless Minnesotans with housing, and the Early Intensive Behavioral Development Intervention (EIDBI) program for children with autism.
“Our cases today involve seven different state-managed Medicaid programs that have been systematically pilfered by fraudsters who treated Minnesota-run programs as their personal piggy bank,” McDonald said.
He pledged that Thursday’s announcement is “the beginning” of the DOJ’s efforts to combat fraud in Minnesota and nationwide.
Health and Human Services Secretary Robert F. Kennedy Jr. said the schemes are wide ranging.
“Investigators uncovered brazen schemes that bill taxpayers for nonexistent services, fraudulent diagnoses and fake care while criminals enriched themselves at public expense,” he said.
The defendants
Federal charges against the following defendants were filed or unsealed this week:
Shamso Hassan, 55, and Hanaan Yusuf, 25, both of Brooklyn Park, are accused of attempting to defraud $46.6 million of Medicaid funds through two autism centers, Smart Therapy Center and Star Autism Center, and paid kickbacks to parents who enrolled their children with them. Authorities say $21.2 million was paid out to their businesses.Charles Healey, 61, and Katherin Larsen-Guthmiller, 66, both of Blue Earth, are accused of bilking the Individualized Home Supports (IHS) for $22.7 million in Medicaid funds through their company, Healey Homes.Deborah Hodges, 59, of Philadelphia, is accused of fraudulently billing Medicaid $5.3 million through HSS provider House of Heroes, Inc. An indictment alleges she billed for in-person services while she attended an inpatient drug treatment program.Ahmed Kadar, 22, of Rosemount, allegedly submitted $1.4 million in fraudulent or claims through the Integrated Community Supports provider Ultimate Home Health LLC and illicitly transferred $400,000 of those funds.Sharmaine Meadows, 45, of Lake Elmo, is charged with attempting to collect $4.3 million from false claims through her HSS provider, Cradle of Love, LLC.Muhammad Abdulqadir Omar, 32, of Roseville, and Ibrahim Bashir Abdi, 25, of Minneapolis, allegedly submitted $3.2 million worth of claims through HSS providers North Home Health Care LLC and South Home Health Care LLC.Jillaine Mertens, 42, of Hamel, is charged with abusing the Great Start Compensation Support Payment Program to the tune of $425,000 through three childcare centers under her ownership.Candice Langley, 62, and Cynthia Allen, 46, both of Philadelphia, each traveled to Minnesota to register as HSS providers and were collectively paid $3.5 million in taxpayer funds after inflating the hours of services provided.Abdulbasit Ibrahim, 22, and Mustafa Dayib, 22, both of Minneapolis, are accused of defrauding HSS through Vitality Health Services, netting $975,000 in fraudulent claims.Fahima Mahamud, 50, of Minneapolis, received nearly $5.5 million through the Child Care Assistance Program and is accused of lying about collecting required co-payments from parents whose children were enrolled in her daycare, Future Leaders Early Learning Center. She is also charged in connection with the $250 million Feeding Our Future meal site scheme.Related stories:
Thursday’s announcement coincided with the sentencing of Aimee Bock, the ringleader in the $250 million Feeding Our Future fraud scheme.
Pointing fingers
McDonald said Minnesota officials’ cooperation in combating fraud has “fallen significantly short,” an assertion that Minnesota Attorney General Keith Ellison has pushed back on.
Ellison’s office runs the state’s Medicaid Fraud Control Unit. Last week, in response to the Trump administration’s announcement that it would cut off funding for MFCUs that do not adequately go after fraud, Ellison said Minnesota’s MFCU has secured more than 340 Medicaid-related convictions and delivered $90 million in restitution since he took office in 2019.
READ MORE: Reaction to latest DOJ fraud charges
Meanwhile, Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services (CMS), said his agency is keeping $350 million in deferred Medicaid payments on hold until the federal government is satisfied with Minnesota’s corrective action plan to ensure taxpayer funds aren’t ending up in the pockets of fraudsters.
“If they had satisfied our needs, we would have released the money,” Oz said.
As part of the deferral, CMS demanded Minnesota recertify all providers of 14 Medicaid-based programs deemed to be at high risk for fraud. So far, Oz said 40% of those providers either haven’t responded or have provided inadequate responses and could face termination by the end of the month.
McDonald did not answer a reporter’s question on whether President Donald Trump would offer clemency for anyone convicted of fraud in Minnesota, as he has done for dozens of others convicted of fraud.
At the end of his first term, Trump commuted the sentence of former California nursing home magnate Philip Esformes, who was imprisoned for defrauding $1 billion from Medicare and Medicaid. Since his inauguration last year, Trump has granted clemency to 35 people convicted of fraud-related crimes.
Jumper arrested
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