PHILADELPHIA, Pa. (WTAJ) — After fraud in Minnesota became a hot topic across the country, two Pennsylvania men pleaded guilty to their part in stealing millions from the state.
Anthony Waddell Jefferson, 37, and Lester Brown, 53, both of Philadelphia, pleaded guilty Monday to defrauding Minnesota’s Housing Stabilization Service (HSS) out of approximately $3.5 million and to using artificial intelligence to create the fake records.
According to court documents, both men set up businesses in Minneapolis as HHS providers, allegedly to help people with disabilities, including seniors and people with mental illnesses and substance abuse disorders, to find and maintain housing.
“Criminal fraud not only robs taxpayers — it shatters trust in our institutions. Under President Trump’s leadership, yesterday’s convictions are just the beginning,” Attorney General Pamela Bondi said. “Our prosecutors will work tirelessly to unravel criminal fraud schemes and charge their perpetrators in Minnesota and across the country.”
Jefferson and Brown would frequently travel to Minneapolis to recruit Medicaid beneficiaries at homeless shelters and Section 8 housing facilities under the guise of “The Housing Guys.” They would sign people up for HHS and then bill the program for services that were never provided.
Court documents showed that the two would use artificial intelligence to fake documents when asked for proof from officials. They fabricated emails and used ChatGPT to create fake client notes.
In total, Jefferson and Brown were accused of stealing $3.5 million from February 2022 through June 2025. It was alleged that they had made claims for services for 230 different Medicaid beneficiaries.
“Defrauding those who rely on government programs takes away critical resources, and the use of artificial intelligence to carry out these crimes is dangerous and will not be tolerated,” FBI Director Kash Patel added. “Yesterday’s convictions demonstrate the FBI’s dedication to investigating and holding accountable criminals that target and take advantage of vulnerable members of our communities.”
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Both pleaded guilty to one count of wire fraud, each, which carries a maximum sentence of 20 years in prison.
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