FWA (NY)- Fraud Week: NY Transportation Company Owners Jailed, Fined


MM Curator summary

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[MM Curator Summary]: Julio Alvarado stole $20M of your tax dollars using a Medicaid transportation scheme. The bennies involved were glad to take his kickbacks in exchange for the info needed to bill for bogus trips.


Clipped from: https://www.jdsupra.com/legalnews/fraud-week-ny-transportation-company-5193658/


Transportation fraud isn’t new, but it’s new to Rivkin Rounds. The U.S. Attorney’s Office for the Southern District of New York recently announced that Yonkers resident Julio Alvarado was sentenced to 95 months in prison for leading a scheme that billed Medicaid for fraudulent transportation claims. From 2017 to 2020, KJ Transportation C Services Inc. collected more than $20 million for providing transportation services for Medicaid enrollees in the New York City area, many of which claims were fraudulent.

Some of the purported passengers were deceased or out of the country when KJ claimed it was transporting them to medical appointments. KJ also used stolen identities to bill for transporting people who had never heard of the company, and some Medicaid recipients were paid kickbacks for providing KJ their Medicaid information or allowing KJ to schedule and bill for fake trips for them.

Alvarado supervised more than a dozen other participants in the scheme and was responsible for billing more than $8 million of the fraudulent claims. In addition to the prison term, he was sentenced to three years of supervised release and ordered to pay $8,507,115 in restitution and to forfeit $8,507,115.

In addition, Ismat Farhan of Schenectady and his company, USA Medical Transport, recently agreed to pay $862,500 to settle false claims allegations. According to Attorney General Letitia James’ Office’s press release, Farhan submitted over 2,500 false claims and billed Medicaid for about $400,000 for transportation services that were not provided as described or at all, or did not have required documentation.