Suffolk Man Gets 97 Months In Prison For Bilking Medicaid For Millions In Bogus Taxi Rides: Feds

SHIRLEY, NY — A Mount Sinai man was sentenced to 97 months in prison for conspiracy to commit healthcare fraud and money laundering in a scheme to steal more than $19 million from Medicaid, while offering fake rides into Manhattan, U.S. Attorney Joseph Nocella's office said Wednesday.

Adnan "Eddie" Arshad, 47, owned MTK Taxi LLC in Montauk, Long Island, and co-owned All-Star Taxi LLC, in Ronkonkoma, according to Nocella's office.

The company, which ran taxis out of Shirley, operated mostly in Suffolk County, his office said.

Patch has reached out to his attorney, Michelle Labayen of Manhattan, for comment.

From around December 2020 to his arrest in June 2024, Arshad and his co-conspirators orchestrated a scheme to defraud Medicaid by paying illegal health care kickbacks to Medicaid
beneficiaries, prosecutors said, adding that they were in exchange for ordering transportation services through their companies, including transportation purportedly for methadone treatment at addiction treatment centers.

In reality, Arshad’s companies generally did not provide the medical transportation services for which they
billed Medicaid, prosecutors said.

Instead, they submitted millions of dollars in fraudulent claims for nonexistent rides, including claims for people who were dead, hospitalized, or incarcerated.

Arshad and his co-conspirators also inflated their Medicaid reimbursements by directing beneficiaries to request transportation to addiction treatment centers in New York City, despite the availability of numerous treatment centers on Long Island, prosecutors said.

By instructing beneficiaries to provide false pickup addresses to make the trips appear longer and therefore more lucrative, according to prosecutors.

Through this scheme, the transportation companies owned or operated by Arshad and his co-conspirators billed Medicaid over $16 million for trips to three addiction treatment centers in New York City, prosecutors said.

Arshad used the illicit proceeds to expand and perpetuate the scheme by purchasing several additional transportation vehicles and to finance a lavish lifestyle, including the purchase of multimillion-dollar homes and luxury vehicles, such as a Ferrari and multiple BMWs and Mercedes, according to prosecutors.

At least five of Arshad’s co-conspirators have pleaded guilty for their participation in the scheme and are awaiting sentencing, prosecutors said.

Nocella said that while "taxpayers footed the bill, Arshad financed a lavish lifestyle with multimillion-dollar homes and luxury vehicles."

Today’s sentence sends a clear message that those who defraud public healthcare programs for personal enrichment should take notice of the price this defendant will now pay for his greed," he said.

“Our office and the Administration are vigorously prosecuting criminals like the defendant who treat Medicaid like their own personal piggy bank," he added.

Nocella expressed his appreciation to the Office of the New York State Comptroller and the Medicaid Fraud Control Unit of the New York State Attorney General's Office for their work on the case.

HHS-OIG Special Agent-in-Charge Naomi Gruchacz said, Arshad "brazenly defrauded the Medicaid program of tens of millions of dollars for transportation services that were never provided."

“HHS-OIG will continue to work with our law enforcement
partners to hold accountable individuals who, to satisfy their own greed, exploit federal health care programs," she said.

IRS-CI New York Special Agent-in-Charge Harry Chavis said that Arshad and his co-conspirators "orchestrated a scheme that siphoned millions from Medicaid, depriving vulnerable patients of resources and fueling a lavish lifestyle
built on fraud."

“This sentencing demonstrates that IRS Criminal Investigation will relentlessly pursue those who exploit public
healthcare programs for personal gain," he said. "Today, justice has caught up with those who treat taxpayer dollars as their own.”

Suffolk District Attorney Ray Tierney said, "Healthcare fraud on this scale does not stay hidden, and it will not go unpunished."

"This defendant saw hard-earned taxpayer funds meant for the less-fortunate as nothing more than a way to line his pockets," he said. "He billed Medicaid for transportation that never happened to finance a lavish lifestyle at the public's expense."

“My office is proud to stand with our federal partners to ensure that this defendant answers for his greed and forfeits what he stole," he added.

This is a breaking story, and will be updated. Check back later.