Texas Lab Owner Charged in $79 Million RPP Testing Fraud Scheme
The owner and operator of a Texas laboratory, Osman Syed, also known as Syed Osman, was charged in connection with a $79 million respiratory pathogen panel (RPP) testing fraud scheme. According to court documents, Syed, a 34-year-old Indian national, caused BioDX Labs LLC (BioDX) to submit over $79 million in fraudulent claims to Medicare and Texas Medicaid for RPP tests that were not provided and were medically unnecessary. Syed used the personal identifying information of a physician without their knowledge or consent to submit millions of dollars in claims to Medicare and Medicaid for RPP tests for beneficiaries and recipients, even though the physician had no prior relationship with them and was not treating them for respiratory symptoms. To conceal that BioDX did not perform the tests as billed, Syed falsely represented that BioDX used reference laboratories for its testing. Syed and his co-conspirators laundered the proceeds of the fraudulent scheme by transferring substantial sums to bank accounts abroad, including accounts in China, Hong Kong, Turkey, Greece, and Switzerland. In connection with the charges, the government seized over $15 million in cash.
Syed is charged with three counts of health care fraud, conspiracy to engage in money laundering, and three counts of money laundering. If convicted, he faces a maximum penalty of 10 years in prison on each count.
The announcement was made by Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division; Special Agent in Charge Jason E. Meadows of the Department of Health and Human Services Office of Inspector General (HHS-OIG) Dallas Regional Office; Special Agent in Charge Travis Pickard of the Homeland Security Investigations (HSI) Dallas Field Office; Special Agent in Charge Craig Wolf of the U.S. Secret Service (USSS) Dallas Field Office; Chief William Marlowe of the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU); and Acting Special Agent in Charge P. J. O’Brien of the FBI Dallas Field Office.
The case is being investigated by HHS-OIG, HSI, USSS, MFCU, and FBI. Assistant Chief Brynn Schiess of the Criminal Division’s Fraud Section is prosecuting the case.
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, currently comprised of nine strike forces operating in 27 federal districts, has charged more than 5,400 defendants who collectively have billed federal health care programs and private insurers more than $27 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 www.justice.gov/criminal-fraud/health-care-fraud-unit.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
