A.G. Underwood Announces Arrests Taxi Company Owner and Employees for Allegedly Defrauding Medicaid
New York, NY - November 8, 2018 - Attorney General Barbara D. Underwood today announced the arrests of Sadat Khan, 29, Kashif Pervez, 36, Marcus Mathis, 41, Chester Haugabook, 48, and William Medina, 35, all of Niagara Falls, for their roles in an alleged scheme to steal over $50,000 from Medicaid by paying off Medicaid recipients in order to fraudulently bill for transport rides. The Attorney General’s ongoing investigation into Medicaid transit scams – dubbed “Operation Ghost Ride” – revealed that Wego Taxi Tours, Inc. submitted claims and received payment from Medicaid for rides that were not provided as claimed.
“When taxi companies falsely report medical transports, New York taxpayers end up footing the bill,” said Attorney General Underwood. “My office will not tolerate fraudulent practices that steal Medicaid resources from vulnerable New Yorkers – and we will continue to bring scammers to justice.”
According to the felony complaint, owner of Wego Taxi Tours, Inc. Sadat Khan allegedly obtained approval for Wego to bill Medicaid by falsely representing to Medical Answering Services (“MAS”), the transportation manager for western New York, that he was the driver for various Medicaid recipients’ transportation to and from their medical appointments. Some of the recipients for which Wego billed were allegedly not picked up or dropped off; additionally, the false pick up addresses were located substantially farther away from the drop off location than the Medicaid recipients’ actual pick up addresses would have been. By using false address information, Wego Taxi Tours, Inc. and Khan allegedly stole over $50,000 from Medicaid by billing for and receiving higher monetary reimbursement for increased mileage than they would have been entitled to had they provided accurate address information. Wego’s corporate secretary Kashif Pervez was charged as a co-defendant for allegedly engaging in the same fraudulent criminal scheme of attesting to MAS that he drove recipients from fraudulent addresses. Khan and Pervez were each charged in Niagara Falls City Court with one count of Grand Larceny in the Second Degree, a class C felony, and one count of Offering a False Instrument for Filing in the First Degree, a class E felony.
If convicted of the most serious charge, Khan and Pervez face between 5 and 15 years in prison.
In separate felony complaints, Wego Taxi Tours, Inc.’s drivers Marcus Mathis, Chester Haugabook, and William Medina were charged with allegedly paying Medicaid recipients to call MAS at their behest to change their pick up location to a different fraudulent address. The three drivers each allegedly then caused Wego to fraudulently bill Medicaid in excess of $7,500 for transportation from the new pick up locations for medical appointments when, in fact, these transport rides were never provided. All three defendants were charged with one count of Grand Larceny in the Third Degree, a class D felony, and one count of Medicaid Assistance Provider Prohibited Practices, a class E felony,
If convicted of the most serious charge, Mathis, Haugabook, and Medina face between 2 1/3 and 7 years in prison.
The charges are merely accusations and the defendants are presumed innocent unless and until proven guilty in a court of law.
The Attorney General thanks the United States Marshals Service and the Niagara Falls Police Department for their assistance in this matter.
The investigation by the New York State Attorney General’s Medicaid Fraud Control Unit was conducted by Investigator Jaimie Krzyskoski, under the supervision of Supervising Investigator James Zablonski, Senior Auditor-Investigator Mary Henry, and Regional Chief Auditor Frank Zeffiro. William Falk is MFCU’s Deputy Chief Investigator-Upstate.
The case is being prosecuted by Thomas N. Schleif, Special Assistant Attorney General in the Attorney General’s Medicaid Fraud Control Unit, under the supervision of Regional Director Gary A. Baldauf. Catherine Wagner is Chief of Criminal Investigations-Upstate. The Medicaid Fraud Control Unit is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney. The Division of Criminal Justice is led by Executive Deputy Attorney General Margaret Garnett.