Five people connected to a Niagara Falls taxi company have been convicted in connection with a scheme to defraud Medicaid of more than $1.2 million, Attorney General Letitia James's office announced Wednesday.
The scheme involved Wego Taxi Tours, which received reimbursements from Medicaid for providing rides for patients to their appointments.
The problem was those rides were never provided.
The state says Wego drivers were taking people to and from the appointments but that the patients didn't live at those addresses and they were never picked up and dropped off at those locations.
"These false pick-up addresses were located substantially farther away from the stated drop-off locations than the Medicaid recipients’ actual pick-up addresses, which allowed Wego to receive a higher monetary reimbursement based upon the increased mileage. According to the plea agreements, Wego billed Medicaid in excess of $7,500 for each Medicaid recipient for transportation that did not occur," a statement from the attorney general's office said.
These phony billings are known as "ghost rides."
“These fraudsters’ free-riding days have come to a screeching halt,” James said in a statement. “Ghost rides hurt the Medicaid program, cost taxpayers money and undermine needed transportation services that New Yorkers depend on every single day."
The owner of the company, Sadat Khan, 31, of Niagara Falls, and its corporate secretary, Kashif Pervez, 37, of Niagara Falls, each pleaded guilty to a felony count of fourth-degree grand larceny. They were sentenced to a three-year conditional discharge. Khan was also ordered to pay $143,610.70 in restitution; Pervez was ordered to pay $39,568.56.
Three Wego drivers also pleaded guilty to medical assistance provider prohibited practices, a felony under the Social Services Law, in the scheme: Marcus Mathis, 42; Chester Haugabook, 50; and William Medina, 36, all of Niagara Falls. All three were sentenced to a three-year condition discharge and ordered to pay restitution.
Mathis must pay $127,395.56; Haugabook, $98,421; and Medina, $260,574.46.