Defendant Knowingly Falsified Documents and Enabled Criminal Enterprise Based in NYC and Long Island, Headed by His Fugitive Father.
New York, NY - May 5, 2014 - Attorney General Eric T. Schneiderman announced that Raheel Pervez was sentenced to a 1-to-3-year prison term today for his part in a multi-year scheme that drained in excess of $16 million from the state Medicaid program. Pervez, 41, who pleaded guilty to felony Enterprise Corruption, is one of six individuals arrested by the Attorney General’s Medicaid Fraud Control Unit in a scheme that involved a web of more than a dozen pharmacies. They defrauded the Medicaid program by targeting vulnerable HIV patients and put their lives in jeopardy by paying them not to fill their HIV prescriptions and then billing Medicaid for those unfilled prescriptions. Three of the pharmacies, two of which operated as the scam's central hubs, were previously ordered to pay $16.7 million in restitution to Medicaid. In addition to incarceration, Pervez has agreed to pay $500,000 in civil forfeiture.
“The theft and abuse of one of our state and nation’s most important health care programs has consequences -- this defendant is going to prison,” Attorney General Schneiderman said. “We are recovering the Medicaid funds stolen in this outrageous scam, one in which health care providers targeted poor HIV patients in New York and offered them cash for their prescriptions instead of the life-saving drugs they need. We’ve put a stop this group of rogue pharmacists – and will pursue all those who seek to rip off our taxpayers.”
Raheel Pervez, of Dix Hills, pleaded guilty last month in Bronx Supreme Court before Justice Steven Barrett, who also sentenced him. He admitted to being the straw owner of the three indicted pharmacies, which were actually owned and controlled by his father, Mujahid “Peter” Pervez. The father, who is charged as the leader of the criminal enterprise, had previously been excluded from participating in New York’s Medicaid program because of a fraud conviction and was prohibited from owning or controlling any pharmacy that treats Medicaid recipients. Click here for more information on the case.
Despite the ban, from January 2009 and April 2012, the enterprise acquired a total of 13 Medicaid-enrolled pharmacies on Long Island and in the Bronx, Manhattan and Queens, defrauded the state and victimized hundreds of Medicaid recipients by submitting false claims to Medicaid for prescription medications that it rarely, if ever, dispensed.
Pervez admitted that the three indicted pharmacies were controlled by his father and that he knowingly filed false documents with the state, claiming ownership and control of each of these pharmacies. Pervez specifically admitted filing false documents related to the ownership and control of Big Mart Pharmacy Inc., and Swami Narayan Pharmacy Inc., d/b/a Super Value Pharmacy, in the Bronx, and Dabup Inc., d/b/a Langdale Drug & Surgical Supplies, in New Hyde Park in Nassau County, and failing to disclose his father’s ownership to state officials, despite being required to do so by law. Two of these pharmacies, Super Value and Langdale, were used as “mothership” pharmacies by Peter Pervez to centralize the ordering of medications for the wider net of pharmacies, so he could more easily control and oversee the criminal enterprise. Raheel Pervez admitted that his father ordered drugs from pharmaceutical wholesalers and deliberately failed to order sufficient HIV drugs to fill prescriptions already received from Medicaid recipients. Under a deal struck with Peter Pervez, a physician's assistant allegedly referred his patients to Big Mart Pharmacy, at 2740 3rd Avenue in the Bronx, in exchange for operating an HIV clinic rent-free in the same building as Big Mart. Langdale was located at 27-103 80th Avenue, New Hyde Park, and Super Value was at 3457 Boston Road in the Bronx.
Indicted along with his son and others for Enterprise Corruption, Grand Larceny and a host of other crimes, Peter Pervez fled to his native Pakistan. The Attorney General’s Office is seeking to extradite him back to New York.
In addition, Raheel Pervez and his wife, non-criminal defendant Ayesha Furqan, agreed to repay $500,000 to settle civil claims asserted in an asset forfeiture action. Raheel Pervez is excluded from Medicaid as a provider and agreed to not be involved in the health care industry in any manner. A civil action asserting various common-law and statutory claims, including under New York's civil forfeiture statute, is currently pending against other members of Mujahid Pervez's family who are alleged to have received criminal proceeds. This includes his wife, Rahila Pervez; daughters Nadia Pervez and Sara Pervez, and son-in-law Mohammad Bilal.
Maria Kramer, another member of the criminal enterprise, was convicted of Enterprise Corruption last year and faces two to six years in prison when she is sentenced. The corporations that operated Big Mart, Super Value and Langdale were each charged and convicted of Enterprise Corruption last summer and ordered to repay the state $16.7 million. Three other defendants, a physician's assistant, and two supervising pharmacists from Super Value and Big Mart are awaiting trial.
The case was investigated by Senior Special Investigator Robert Crook, Senior Special Audit Investigators Olga Sunitsky and Shoma Howard, and Special Auditor Investigators Joshua Berry, Giovanni Liotine and Kashmir Singh. Recently retired Senior Special Investigators James Serra and Robert Flynn also worked on the investigation.
The case is being prosecuted by Special Assistant Attorneys General David Abrams and Herman Wun, as well as by Deputy Regional Director Larissa Payne of the Attorney General’s Medicaid Fraud Control Unit, New York City Regional Office, with Regional Director Christopher M. Shaw. The Medicaid Fraud Control Unit is led by Acting Director Amy Held. The Criminal Division is led by Executive Deputy Attorney General Kelly Donovan.