NJ Man Pleads Guilty in $1.7B Health Care Fraud Plan

Hafizullah Ebady of New Jersey admitted to his role in a $1.7 billion health care fraud and money laundering scheme.Photo bycamera obscuraonUnsplash

Hafizullah Ebady, 45, of Parsippany, New Jersey, pleaded guilty today to his role in a massive international health care fraud and money laundering scheme, the U.S. Attorney's Office, Eastern District of New York announced.

Ebady's co-defendants—Joshua Manuel Alegria, David Gary Bishoff, Brycen Kay Millett, Dela Saidazim, Anthony Santamaria, and Hershel Tsikman—have also pleaded guilty.

The alleged leader, Brian Sutton, a U.S. citizen residing in Russia, remains at large, according to the department.

Between 2017 and 2022, Ebady and his co-defendants engaged in an elaborate scheme involving the acquisition of pharmacies across the United States, including locations in New York, New Jersey, Texas, and Michigan, the department stated.

Led by Sutton, the defendants used these pharmacies and call centers to generate fraudulent prescriptions by deceiving individuals into accepting unnecessary medications.

Led by Sutton, the defendants allegedly used these pharmacies and call centers to generate prescriptions by persuading individuals to accept medications that were not medically necessary.

According to the department, Ebady oversaw the purchase and daily operations of several pharmacies involved in the scheme. The defendants acquired pharmacies that already had relationships with private health insurance companies.

These pharmacies, along with call centers and a network of recruited physicians, were used to generate over $1.7 billion in prescriptions purportedly filled by the pharmacies in question.

At Sutton’s direction, the co-conspirators operated call centers initially based in Utah, later moving them to Russia and other foreign nations, the department stated.

Call center employees reached out to beneficiaries enrolled in private insurance plans, offering prescription medications at little to no cost, often without any medical examination to assess necessity.

The department stated that the defendants also recruited doctors to approve prescriptions, often without any telemedicine visits occurring.

The co-conspirators generated fraudulent prescriptions under the physicians' names and National Provider Identifier numbers. Many beneficiaries never received the medications.

To conceal their involvement, the defendants operated under aliases, funneled hundreds of millions of dollars through shell companies and straw owners, used encrypted communications, and moved operations overseas, according to the department.

Private insurers paid over $500 million as a result of the fraudulent billing, the department said.

Ebady faces a maximum sentence of 10 years in prison, as well as restitution of more than $195 million and forfeiture of over $1.8 million when sentenced.

Notably, the charges against Sutton are merely allegations, and he is presumed innocent unless and until proven guilty.

“Using aliases, shell companies and straw owners, moving their operations overseas, and laundering millions of dollars through foreign countries, the defendants conducted a sophisticated, multi-faceted scheme, employing scores in call centers and remote billing teams to line their pockets to the tune of more than a billion dollars,” said Breon Peace, United States Attorney for the Eastern District of New York, in statement.