California latest target in Department of Justice efforts to end public benefits fraud

LOS ANGELES (AP) — More than a dozen people in Southern California were charged with allegedly siphoning nearly $2 billion in fraudulent healthcare costs, the Department of Justice and state prosecutors announced Thursday, as President Donald Trump’s administration ramps up efforts to end the abuse of federal aid programs.

Fifteen people were charged and so far at least eight were arrested in connection with fraud at substance abuse treatment centers, hospice services and surgeons in California, prosecutors said. At least six of those charged were doctors — including one who is accused of performing unnecessary and invasive surgeries to bill Medicaid for over $130 million.

“If you treat healthcare patients as dollar bills, the Department of Justice is coming for you,” said Colin M. McDonald, assistant attorney general for the National Fraud Enforcement Division. He was flanked by FBI officials and First Assistant U.S. Attorney Bill Essayli.

The operation is the latest in a recent wave of arrests related to alleged public benefits fraud, an issue that has emerged as a cornerstone of the president’s agenda throughout his second term. Trump and Vice President JD Vance on Tuesday announced a $25 million program to encourage whistleblowers to report suspected fraud in the U.S. government.

High-ranking federal officials in recent days have touted the crackdowns across the country ahead of a competitive midterm election that will decide the balance of power in the U.S. Congress for the final two years of Trump’s second term.

Vance and Attorney General Todd Blanche announced in Cincinnati on Wednesday that the administration had uncovered over $40 million in fraudulent Supplemental Nutrition Assistance Program benefits nationwide since September. Thirteen people in Ohio were indicted as part of that crackdown.

In Missouri, meanwhile, Republican Gov. Mike Kehoe on Thursday announced a collaborative effort with the U.S. Department of Justice to “aggressively identify, investigate and prosecute fraud” in Medicaid, SNAP and other federally funded benefits administered by the state.

“Missouri is all-in in the Trump administration’s unprecedented war on fraud,” Kehoe said while flanked by Missouri Attorney General Catherine Hanaway and two U.S. attorneys.

Hanaway said the endeavor is a continuation of existing antifraud efforts, with improved federal-state cooperation.

In the pre-dawn hours of Thursday morning, federal authorities descended on a massive gated house in the upscale residential neighborhood of Tarzana in Los Angeles. There, they arrested Hany Malek, 61, a chiropractor indicted on charges that he posed as a doctor in order to refer patients for medically unnecessary atherectomies — an invasive procedure in which a catheter is used to clear plaque from arteries.

Prosecutors say Malek referred the patients to his business partner and surgeon, Dr. Harold Tabaie, 78, of Anaheim, who sometimes falsely told patients that the initial surgery was unsuccessful in order to justify another. The duo allegedly made roughly $134 million through these unnecessary procedures, prosecutors said.

Both men are charged with four counts of healthcare fraud, and the chiropractor is charged with an additional two counts of bank fraud. No attorneys were listed for either Malek or Tabaie. Efforts to reach both men through phones listed on public records were unsuccessful on Thursday morning.

A network of dozens of fake substance abuse treatment centers raked more than $1.5 billion — the bulk of the roughly $2 billion — for addiction treatment that was never provided.

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Associated Press writer David A. Lieb contributed from Jefferson City, Missouri.