New York, June 19: A significant Medicaid fraud case involving $38 million has emerged from a daycare center in the United States. Reports indicate that a well-known leader from the Pakistani-American community has been arrested in connection with this scheme targeting elderly daycare centers.
According to information shared by the New York Post, Parvez Siddiqui, a member of a community board in Brooklyn, New York, was among seven conspirators arrested on Thursday.
Federal prosecutors have charged Parvez with committing fraud against the government health insurance program, Medicaid. This involved a fraudulent billing scheme operated through two social adult daycare centers in Brooklyn: Apna Adult Daycare and Ashiyana Social Adult Daycare.
Reports suggest that he and the other conspirators were allegedly involved in recruiting individuals who were falsely represented as participants in programs for adults with disabilities or serious illnesses. These centers submitted bills under the names of individuals who either did not participate in the programs or did not require these services at all.
The New York Post reported that from 2019 until December of last year, they submitted bills to Medicaid for services that were purportedly provided to individuals recruited by them. According to federal prosecutors, the accused shared a portion of the funds with these individuals in exchange for using their identities to file fraudulent claims.
The report identifies several co-defendants alongside Parvez, including Shazia Bibi (also known as Shazia Wattoo), Abdul Aziz, Shair Ali, Zebun Ahmed, Josna Begum, Saira Khatoon, and Atiya Shahbaz.
The Post noted that the indictment stated they utilized a Pakistan-based billing staff and employed code words like “ladoo” while laundering money through shell companies.
The report also indicated that the centers showed inflated attendance on fake sign-in sheets, with some participants reportedly located in Pakistan.
Medicaid is a government insurance program designed for the poor in the United States. The accused allegedly exploited it for fraudulent billing; this program pays for long-term care for elderly or ill individuals, with payments reaching up to $6,000 per person per month.
In December, authorities conducted raids at locations associated with the alleged scam. Seventy-eight-year-old Parvez Siddiqui owns around 15 pharmacies in New Jersey. He is connected with the American Pakistani Public Affairs Committee, which has provided him access to New York Mayor Joran Mamdani and other officials.
Co-defendant Shazia Bibi is also a member of the community board. According to U.S. media, the charging documents do not name the pharmacies. In 2022, Shazia testified before the city council, stating, “We feel isolated as a Pakistani-American community and as a Muslim American because we have not received resources as a community.”
In a separate case, Zakia Khan and Ehsan Ijaz were found guilty in federal court for defrauding the government of $68 million through fraudulent billing in another Medicaid program.
The owners of Happy Family Social Adult Daycare and Family Social Adult Daycare admitted to committing fraud in another program aimed at helping elderly citizens. They paid relatives to care for their loved ones at home to avoid higher costs in nursing homes.
Brooklyn federal prosecutor Brian Peace stated at the time, “Social adult daycare and home health services are meant to assist elderly citizens, but as alleged, the defendants openly exploited their business to siphon millions from the Medicaid program.”
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