Woman Pleads Guilty to $359M Fraud

A California woman pleaded guilty Thursday to fraudulently submitting claims to governmental and private insurance programs during the COVID-19 pandemic for expensive and medically unnecessary respiratory pathogen panel (RPP) tests.

"Those who stole from government health programs during the COVID-19 pandemic not only violated federal law, they betrayed the public trust," said Attorney General Merrick B. Garland. "As this action to disrupt a $359 million scheme, and the Department's recent announcement involving over 300 defendants and over $830 million in alleged COVID-19 fraud make clear, the Justice Department will continue to find and hold accountable those who defrauded American taxpayers during the pandemic."

"Today's plea marks an end to this costly health care fraud scheme in which bad actors fraudulently ordered medically unnecessary tests to reap ill-gotten gains," said FBI Director Christopher Wray. "Through coordination and close collaboration with our partners, the public can rest assured that the FBI will work relentlessly to protect our healthcare system and hold those accountable who attempt to illegally exploit it."

According to court documents, from June 2020 to April 2022, Lourdes Navarro, 64, of Glendale, conspired with Imran Shams to obtain nasal swab specimens from residents and staff at nursing homes, assisted living facilities, rehabilitation facilities, and students and staff at primary and secondary schools, for the purported purpose of conducting screening tests to identify and isolate individuals infected with COVID-19. Obtaining those samples enabled Matias Clinical Laboratory, dba Health Care Providers Laboratory (HCPL), to perform RPP tests on some of the specimens, even though only COVID-19 testing had been ordered and even though there was no medical justification for conducting RPP tests. Navarro and Shams submitted, through HCPL, approximately $359 million in claims for the unnecessary RPP tests to Medicare, the Health Resources and Services Administration COVID-19 Uninsured Program, and a private health insurance company, and were reimbursed approximately $54 million.

"The defendant used her management position at a clinical testing laboratory to exploit the COVID-19 pandemic for personal gain," said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department's Criminal Division. "This case demonstrates the Criminal Division's continued resolve in working with our partners to root out bad actors who steal from government health programs."

"I would like to thank our law enforcement partners, as well as my dedicated team of investigators, analysts, and attorneys, for bringing this fraud scheme to light and shutting it down," said Inspector General Christi A. Grimm of the Department of Health and Human Services (HHS). "Stealing public money is unacceptable in any circumstance, but particularly egregious when taking advantage of a public health emergency."

Navarro pleaded guilty to conspiracy to commit health care fraud and wire fraud. She is scheduled to be sentenced on Jan. 23, 2024, and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Shams previously pleaded guilty to conspiracy to commit health care fraud and is scheduled to be sentenced on Jan. 9, 2024.

The FBI and HHS-OIG are investigating the case.

Trial Attorneys Gary A. Winters and Raymond E. Beckering III of the Criminal Division's Fraud Section are prosecuting the case. Assistant U.S. Attorney Maxwell Coll for the Central District of California obtained seizure warrants and is handling forfeiture.

The Fraud Section leads the Criminal Division's efforts to combat health care fraud through the Health Care Fraud Strike Force Program. Since March 2007, this program, comprised of 15 strike forces operating in 25 federal districts, has charged more than 5,000 defendants who collectively have billed the Medicare program for more than $24 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at http://www.justice.gov/criminal-fraud/health-care-fraud-unit.