East Haven Mental Health Clinic Owner Pleads Guilty To Fraud

EAST HAVEN, CT —A Branford man who ran a mental health center in East Haven and Branford pleaded guilty to health care fraud for billing Medicaid for patient psychotherapy that was not delivered, federal prosecutors said.

Wali Muhammad, 45, who faces up to 10 years in prison, must pay more than half a million dollars in restitution. He'll be sentenced June 23.

According to the US Attorney's office, based on court documents and statements made in court, from 2010 to 2019 Muhammad owned and operated Happy Family Clinical Services, a mental health and social services agency. Happy Family’s office was located in East Haven and Branford, before moving to New Haven in 2014.

From 2013 through 2019, Muhammad "engaged in a scheme to defraud the Connecticut Medicaid Program by submitting fraudulent claims for psychotherapy services that were purportedly provided to Medicaid clients," prosecutors said.

According to court documents, he billed for therapy sessions that never happened, and, federal prosecutors said, he also submitted those claims using the names of licensed clinical social workers and other licensed health care providers who "purportedly worked" for Happy Family noting they'd done the therapy sessions, "when, in fact, the licensed providers had not personally rendered the services, had not supervised the services that were billed, and were unaware that Muhammad was billing or causing the services to be billed as if the providers had personally rendered the services."

And, the U.S. Attorney said, when mental health services were provided, "they were usually rendered by unlicensed individuals and billed as licensed psychotherapy."

The case was investigated by Special Agents of the Office of the Inspector General of the U.S. Department of Health and Human Services, and Police Inspectors from the Medicaid Fraud Control Unit of the state Chief State’s Attorney’s Office. The Connecticut Attorney General’s Office, the state Department of Social Services, and the state Department of Mental Health and Addiction Services also provided assistance in the investigation, the U.S. Attorney said.

People who suspect health care fraud are encouraged to report it by calling 1-800-HHS-TIPS.