A federal jury convicted a Michigan pharmacy owner and his brother on charges of conspiracy to commit health care fraud and wire fraud, following a thorough investigation into fraudulent activity involving Medicare, Medicaid, and Blue Cross Blue Shield of Michigan, the Department of Justice (DOJ) announced on Friday.
Raad Kouza, a pharmacist from Wayne County, and his brother Ramis Kouza, from Oakland County, were found guilty of orchestrating a fraudulent scheme from 2010 to 2019. The brothers billed health care programs for medications they never dispensed.
The brothers ran five Michigan-based pharmacies—ER Drugs, Seaway, Food Town, Rockwood, and St. Paul—through which they submitted false claims that defrauded the health care programs of more than $15 million. Court documents revealed they routinely sought reimbursements for prescriptions they did not have the inventory to fill, resulting in overpayments that investigators estimate to be more than $7 million. This includes over $1.2 million in Medicaid overpayments alone.
The fraud scheme was uncovered in 2016 during a civil investigation by the Michigan Department of Health and Human Services Office of Inspector General, which flagged suspicious billing practices and significant inventory shortages. Despite several notices about discrepancies, the Kouza brothers continued their fraudulent activities, which eventually led to a federal criminal investigation.
In addition to the conspiracy charge, Raad Kouza was convicted on a separate health care fraud charge. Both defendants now face a maximum sentence of 20 years in prison for the conspiracy charge, with Raad Kouza potentially serving an additional 10 years for the health care fraud conviction, the DOJ stated.
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