Nine Pharmacists Charged for Role in $12.1 Million Health Care Fraud Scheme

Nine pharmacists were charged in three separate indictments unsealed last week for their alleged participation in a $12.1 million health care fraud scheme executed in Detroit and southern Ohio.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Matthew Schneider of the Eastern District of Michigan, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) Chicago Region and Special Agent in Charge Steven M. D’Antuono of the FBI’s Detroit Field Office made the announcement.

Auday Maki, 66, of Northville, Michigan, was charged with three counts of health care fraud.  Hassan Abdallah, 49, of Sterling Heights, Michigan; Raef Hamaed, 50, of Scottsdale, Arizona; Tarek Fakhuri, 47, of Windsor, Canada; Kindy Ghussin, 45, of Greene County, Ohio; Balhar Singh, 57, of Butler County, Ohio; and Ali Abdelrazzaq, 44, of Sterling Heights, Michigan were each charged with one count of conspiracy to commit health care fraud and wire fraud. In addition, Abdallah and Abdelrazzaq were each charged with three counts of health care fraud and Fakhuri with two counts of health care fraud.  Finally, Hassan Khreizat, 40, of Dearborn Heights, Michigan; and Nofal Cholag, 41, of Macomb, Michigan were each charged with one count of conspiracy to commit health care fraud and wire fraud and four counts of health care fraud.

The three indictments were filed in the Eastern District of Michigan. Maki, Hamaed, Ghussin, Singh, Abdelrazzaq, Cholag, and Khreizat appeared Tuesday before U.S. Magistrate Judge Anthony P. Patti in the Eastern District of Michigan. Abdallah appeared today in the Eastern District of Michigan before Judge Patti.

The nine defendants are licensed pharmacists and/or owners of pharmacies in Michigan and Ohio: Eastside Pharmacy Inc. (Eastside), Harper Drugs Inc. (Harper Drugs), Wayne Campus Pharmacy LLC (Wayne Campus), Universal Pharmacy LLC (Universal) and City Drugs Pharmacy Inc. (City Drugs), each located in the Detroit metro area, and Heartland Pharmacy LLC (Heartland) and Heartland Pharmacy 2 LLC (Heartland 2), which are located in Ohio.

The indictments allege that, using the pharmacies, the defendants billed Medicare, Medicaid, and Blue Cross Blue Shield (BCBS) for prescription medications that were neither purchased nor dispensed.  The indictments further allege that the defendants billed Medicare and Medicaid for medications that were often medically unnecessary and for some medications that were purportedly dispensed to deceased beneficiaries after their dates of death.

The indictments allege that the defendants received over $12.1 million due to fraudulent claims they submitted to Medicare, Medicaid, and BCBS. In particular, the indictments allege that, from 2010 to 2019, Medicare and Medicaid paid Abdallah, Hamaed, Fakhuri, Ghussin, Singh, and Abdelrazzaq, through Eastside, Harper Drugs, Heartland, Heartland 2, and Wayne Campus, approximately $6.9 million for drugs that the pharmacies did not have sufficient inventory to dispense.

From January 2013 to January 2016, Medicare, Medicaid, and BCBS allegedly paid Cholag and Khreizat, through Universal, approximately $1.5 million for drugs that the pharmacy did not have sufficient inventory to dispense. From January 2011 to February 2018, Medicare and Medicaid allegedly paid Maki, through City Drugs, approximately $3.7 million for drugs that the pharmacy did not have sufficient inventory to dispense. The indictments further allege that the defendants received significant funds from their participation in these schemes.                    

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.       

The FBI and HHS-OIG investigated this case with assistance from the Michigan HHS-OIG. Trial Attorney Howard Locker of the Criminal Division’s Fraud Section investigated the case, and Trial Attorney Claire Sobczak is prosecuting the case. 

The Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.