Peter Khaim and his brother, Arkadiy Khaimov, over a dozen New York-area pharmacies that they owned and controlled. And what started maybe as a family run business, turned into a complex conspiracy to launder the proceeds of a fraudulent health care scheme. Fun sibling activities! Khaim and Khaimov used the New York pharmacies to submit millions of dollars in fraudulent claims to Medicare, including during the COVID-19 pandemic.
An emergency prescription override is a short-term supply of medication that a pharmacy can provide when a patient needs it immediately and prior authorization is unavailable. Overrides should only be used in emergency situations when it is impractical for a provider to place an order and when delay of medication administration can result in patient harm. Unfortunately, fraudsters don’t care who they put at risk. Khaim, and Khaimov exploited the COVID-19 emergency for their own financial gain by using COVID-19-related “emergency override” billing codes to submit fraudulent claims for very expensive cancer medications that were not prescribed by physicians or dispensed to patients. Yet all were purportedly dispensed during periods when certain pharmacies were closed. Therefore, the “need” for an emergency override.
The only emergency override is on the U.S. taxpayer. Khaim and Khaimov fraudulently obtained over $18 million from Medicare due to fraudulent prescriptions. They funneled their money through several shell companies, including sham pharmacy wholesale companies designed to look like legitimate wholesalers. The funds were then typically sent to companies in China for distribution to individuals in Uzbekistan. Although Khaim and Khaimov saved some for themselves to purchase real estate and other luxury items.
On June 24, 2024, Khaim and Khaimov were sentenced to eight years sand six years in prison respectively.
Excellent job by the F.B.I in this case.
Today’s Fraud of The Day is based on article “Pharmacy owners in US sentenced for $18M COVID fraud, money laundering” published by Anatolia Agency News on June 24, 2024.
Two pharmacy owners in the US are sentenced for an $18 million COVID-19 health care fraud and money laundering scheme, the Justice Department said Monday. Peter Khaim, 44, of Forest Hills, New York, was sentenced Monday to eight years and one month in prison, while his brother and co-defendant Arkadiy Khaimov, 41, also of Forest Hills, was sentenced on April 3 to six years in prison, it said in a statement.
The duo pleaded guilty in November 2022 to conspiracy to commit money laundering charges. Khaim and Khaimov used the New York-area pharmacies to submit millions of dollars in false and fraudulent claims to federal health insurance program Medicare and then laundered the proceeds during the coronavirus pandemic, according to the statement.
