CHICAGO — Police say a man from the North Side took part in a scheme to scam Medicare out of $6.2 million for COVID-19 tests that were never done. This is part of what the police call an ongoing crime “epidemic” that has stolen tens of millions of dollars from government-funded pandemic relief programs.
Indian-born Fasiur Syed, 46, has lived in Chicago for eight years after moving there eight years ago. He was caught last week on a healthcare fraud charge.
They asked that he be held without bond until his trial because they said he didn’t have much reason to stay here to face the charges and could be in danger from other people who were working with them behind the scenes.
An assistant U.S. attorney named Brian Hayes said at a detention hearing Thursday, “These schemes are a plague in this district, and they need to be stopped.”
Jack Corfman, Syed’s lawyer, said Syed was a fairly low-level player who didn’t make much money from the claimed fraud. He lives with his cousin in an apartment in the West Rogers Park neighborhood of Chicago. Corfman said that he works as an Amazon warehouse worker and a ride-share driver.
It was risky for U.S. Magistrate Judge Jeffrey Cole to let Syed, who is not a member of the U.S., out on bond, but Cole said that the prosecutors had not done enough to keep him in jail. He let Syed go on an unsecured $25,000 bond and told him to give up his passport and follow a curfew when he wasn’t working.
The judge also told Syed that trying to run would make his life a lot harder.
Cole told them, “Don’t run away.” “They’ll get you.”
The 27-page lawsuit says that earlier this year, police noticed an “extraordinary spike in billing” for COVID-19 tests from a lab in Bensenville called Advanced Diagnostic Solutions Inc., which was set up under Syed’s name.
The lawsuit says that Advanced Diagnostic Solutions sent about 29,411 claims to the Medicare program between January 29 and March 13, a period of only 38 days. The insurance company was paid about $6.2 million for these claims.
The lawsuit said that more than 97% of the “patients” that Syed’s lab billed for live outside of Illinois. These people live in New York, California, Florida, Alaska, Puerto Rico, and Hawaii, among other places. A lot of the people the police talked to said they had never been tested for COVID, never looked for such tests, and never heard of Advanced Diagnostic Solutions.
The lawsuit said that Syed’s company sent one $323 bill to Medicare, saying that they had done tests for a patient named “JC” in January. JC, who lives in Arkansas, told agents on February 7 that they “had never had their mouth or nose swabbed” and that Syed’s company had “no way in this world” given them any COVID-19 tests.
The bank transactions of the company were traced to a Chase branch on West Peterson Avenue, which is close to Syed’s apartment, according to the lawsuit. When Syed was arrested on May 24, he told police that someone he knew as “Afroz” told him to do the deals and offered to pay him $50,000 to $70,000 for putting his name on the business and signing the bank accounts, according to the complaint.
The charges said, “Syed said he didn’t know who did the billing or bought lab supplies for Advanced Diagnostic Solutions.” “Syed said his actions were wrong at the time, but he did them anyway because it was easy money.”
The charges were the latest in a string of court cases related to similar fraud schemes. The scammers mostly used government programs to make testing for the pandemic cheaper for people. For example, the Biden administration recently tried to give anyone free test kits that they could use at home by having providers directly bill Medicare.
Federal agents recently took more than $60 million from bank accounts in the Chicago area that were linked to companies that were involved in schemes like Advanced Diagnostic Solutions. This was shown in court records.
Court records show that the federal government asked for and got $43 million in fake Medicare funds for test kits billed by a fake company called SK Diagnostics. The company’s main office was in an empty storefront on North Cicero Avenue.
Court records show that earlier this year, another warrant tried to stop $5.1 million in Medicare payments to a business called State Scientific. Like Syed’s company, State Scientific had billed for a huge number of tests in a very short amount of time.
On June 5, 2023, police went to what they thought were State Scientific’s offices in the 1500 block of North Mannheim Road in Stone Park. However, they found a restaurant there instead.
The seizure order said, “Right next to the restaurant was an empty area with a sign that said “For Rent,” and State Scientific did not seem to be there.”
And last month, Baqar Hussain Razv Syed, who is not related to Fasiur Syed, pleaded guilty in Chicago’s federal court to being the middleman for a fraud involving Schaumburg-based Luna Labs. Court records show that Luna Labs billed Medicare for more than $14 million in false tests over three months in 2023.
In his plea deal with authorities, Baqar Syed said that his co-conspirators, who have not been charged, agreed to pay him $10,000 a month for his help.
On July 18, U.S. District Judge Matthew Kennelly will hand down his punishment.
