DOJ Charges 15 in Los Angeles Health Care Fraud Takedown Tied to Over $1.8 Billion in Alleged False Claims
The U.S. Department of Justice announced on October 22 that it had charged 15 defendants, including six medical professionals, in a series of Los Angeles-area health care fraud cases involving more than $1.8 billion in alleged fraudulent claims to government and private health insurance programs. Eight defendants were arrested that day; six were expected to make initial appearances that afternoon at the U.S. District Court in downtown Los Angeles, in Los Angeles County, California, and two at a federal court in Texas. The department noted that the charges are allegations and that defendants are presumed innocent unless and until proven guilty.
The largest case involves more than $1.6 billion billed in an alleged sham substance-abuse treatment scheme. Prosecutors allege that David Young, 71, also known as 'Sancho Lopez,' and Nathan Young controlled dozens of purported treatment companies, and that together with Honey Phipps, 42, and Cody Phipps, 36, they used 'body brokers' to recruit vulnerable people from around the country, bring them to Southern California and elsewhere for sham treatment, and bill private insurers. The department called it the largest sober home fraud scheme it has ever prosecuted. Nicholas Moore, described as an area manager, has pleaded guilty and admitted helping submit $199 million in fraudulent claims, according to the department.
A second case involves $134 million fraudulently billed to Medicare for medically unnecessary atherectomy procedures that prosecutors say injured patients; Anaheim cardiothoracic surgeon Harold Tabaie, 78, and Hany Malek are charged in that case. Three hospice fraud schemes account for more than $138 million in alleged false billings for patients who were not terminally ill, and another defendant was indicted in a $270 million scheme to defraud Medi-Cal, California's Medicaid program, through bogus pharmacy claims.
'These charges include the largest sober home fraud scheme the Department has ever prosecuted, and a scheme involving unnecessary invasive procedures detected through data analytics,' said Assistant Attorney General Colin M. McDonald of the Justice Department's National Fraud Enforcement Division. First Assistant U.S. Attorney Bill Essayli for the Central District of California said it is especially egregious when health care professionals who pledged to do no harm resort to greed and criminality, and that every dollar drained from public and private health insurance systems is one less dollar available to those who truly need it.
In the artery-procedure case, FBI agents surrounded a mansion in Tarzana, Los Angeles, early on October 22 and arrested Hany Malek, 61, a chiropractor. According to the New York Post, prosecutors say Malek kept an arsenal and was treated as armed and dangerous. Prosecutors allege Malek posed as a medical doctor, diagnosed patients with arterial disease they did not have and recommended the procedure, and that Tabaie then performed the procedures, including repeat procedures on the same patients.
Also charged in the same takedown was Dr. Dejun Wang, 62, of Walnut, who was indicted for the prohibited sale of prescription drug samples: prosecutors allege he sold sample drugs, including Rybelsus, Ozempic and Mounjaro, to pharmacy owners in the San Gabriel Valley, who repackaged and dispensed them to customers; prescription drug samples are promotional items that are not intended to be sold.
Source: GSM · USA (original Chinese edition)
Photo: 图：美国司法部徽章。图片来源：美国司法部（公共领域） / Photo: Seal of the U.S. Department of Justice. Source: U.S. Department of Justice (public domain)
- 2026-10-22Walnut Physician Dejun Wang Indicted: Accused of Selling Ozempic and Other Drug Samples to San Gabriel Valley Pharmacies
- 2026-10-22DOJ Charges 15 in Los Angeles Health Care Fraud Takedown Tied to Over $1.8 Billion in Alleged False ClaimsThis story
