AG Schneiderman says two pharmacists (one from Rockland and one from Westchester) illegally steered Medicaid bills through another company for pharmacies barred from doing business with program

PEARL RIVER – Attorney General Eric T. Schneiderman on March 12 announced the arrest and arraignment of two Rockland and Westchester County pharmacists on charges of stealing more than $500,000 from New York State’s Medicaid program. According to the charges filed today in County Court, Rockland County, New City, New York Shaheen Begum, 57, of New City and Syed Rahman, 62, of Briarcliff Manor conspired to use Rahman’s pharmacy to bill the Medicaid program for prescriptions filled by Begum after Begum’s Kwik Aid Pharmacy was barred by the State from doing business with Medicaid. The defendants face imprisonment of up to 5 to 15 years if convicted of the top charge of grand larceny in the second degree.

In addition to issuing indictments for Rahman and Begum as individuals, the Attorney General’s office also filed charges against the pharmacies they owned and operated: Kwik Aid Pharmacy, Inc. of New City, Haverstraw Pharmacy Inc. of Garnerville, and Prescription Plus Corporation, a pharmacy in Briarcliff Manor.

“My office has zero tolerance for pharmacists who rip off the taxpayers by defrauding New York’s Medicaid program,” said Attorney General Schneiderman. “When unscrupulous operators scam the system, they are stealing from the taxpayers and threatening programs that are intended to provide vital health services to low income individuals and families. My office will use every tool at our disposal, including criminal prosecutions like this, to weed out waste, fraud and abuse in our State’s Medicaid program.”

In January 2008, the state agency that regulates pharmacies in New York determined that both Shaheen Begum and Kwik Aid Pharmacy were guilty of professional misconduct. In addition, they were also kicked out of the Medicaid program. This exclusion from Medicaid prohibited either Begum or Kwik Aid Pharmacy from serving Medicaid patients or seeking payment from Medicaid.

Schneiderman said that ather than complying with the penalty, Begum conspired with Syed Rahman, the owner of Prescription Plus, to submit claims for payment under Prescription Plus’ Medicaid provider number for prescriptions that Begum continued to accept and process at Kwik Aid. Begum and Rahman engaged in the same scheme with Haverstraw Pharmacy, which was also operated by Begum and which had never been approved as a Medicaid provider. This scheme cost more than $500,000 in prescriptions that were improperly paid for by Medicaid, the AG’s Office said.

In 2011, Attorney General Schneiderman launched an initiative to bolster his office’s Medicaid Fraud Control Unit (MFCU) and create a Taxpayer Protection Bureau to crack down on fraud. At no cost to taxpayers, Schneiderman added dozens of additional prosecutors, investigators and auditors to the team charged with investigating, penalizing, and prosecuting individuals and companies responsible for improper or fraudulent Medicaid billing schemes. The MFCU utilizes a team-based approach to identify and investigate frauds committed by hospitals, nursing homes, pharmacies, doctors, dentists, nurses, and other health care entities billing the Medicaid Program. In the last two years, MFCU has charged dozens of health care professionals and corporations, including doctors, pharmacists and nurses, with defrauding the Medicaid program and recovered more than $478 million in money stolen from New Yorkers.

The case is being prosecuted by Special Assistant Attorney General William McClarnon of the Attorney General’s Medicaid Fraud Control Unit, under the supervision of Regional Director Anne Jardine, Special Deputy Attorney General Monica Hickey-Martin and Executive Deputy Attorney General for Criminal Justice Kelly Donovan.

The investigation was led by Senior Special Investigator Frank DiChiaro, under the supervision of Supervising Special Investigator Paul Greenspan and Chief Investigator Thaddeus Fisher, and Principle Special Auditor Investigator Jean Moss and Associate Special Auditor Investigator David Lee, under the supervision of Regional Chief Auditor John Regan.

The charges filed in this case are accusations. The defendants are presumed innocent until proven guilty in a court of law.


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