Forest Hills Duo Indicted In $30M Medicare Fraud Scheme: Feds

FOREST HILLS, QUEENS — Two Forest Hills men were indicted on charges of health care fraud and money laundering related to a $30 million Medicare scam that exploited emergency billing authorizations available due to the coronavirus pandemic, federal prosecutors announced Monday.

Peter Khaim and Arkadiy Khaimov are accused of filing millions of dollars worth of false Medicare reimbursement claims for Targretin Gel, a cancer drug that sells for $34,000 a tube on the wholesale market, according to the indictment filed in Brooklyn federal court.

To submit the claims, the duo used emergency override billing codes that went into effect due to the COVID-19 pandemic to make sure patients could get their medications during the crisis, prosecutors said.

Prosecutors said Khaim and Khaimov controlled more than a dozen New York pharmacies as part of the scheme, paying others to pose as the owners and pharmacists so they could get pharmacy licenses.

The duo is also accused of setting up a network of sham pharmacy wholesalers to launder the proceeds of their scheme, according to prosecutors.

Working with an unnamed "international money launderer," the duo wired funds from the fake wholesalers to companies in China for distribution to individuals in Uzbekistan, according to a news release.

The men used the money to buy real estate and unspecified luxury items, prosecutors said.

“We allege Mr. Khaim and Mr. Khaimov used the COVID-19 pandemic as cover to exploit changes in the Medicare system,” FBI Assistant Director-in-Charge William Sweeney, Jr., said. “The changes to this program, funded by taxpayers, were put in place to help fellow citizens obtain needed medications during the pandemic, not line the pockets of fraudsters."