Two pharmacy owners have been sentenced for using New York-area pharmacies to submit millions of dollars in false and fraudulent claims to Medicare and laundering the proceeds, including during the COVID-19 pandemic.
Peter Khaim, 44, of Forest Hills, New York, was sentenced today to eight years and one month in prison. His brother and co-defendant, Arkadiy Khaimov, 41, also of Forest Hills, was sentenced on April 3 to six years in prison.
According to court documents, Khaim and Khaimov engaged in a complex money laundering conspiracy involving 16 New York-area pharmacies that they and their co-conspirators owned and controlled. They exploited the COVID-19 emergency by using “emergency override” billing codes to submit fraudulent claims for expensive cancer medications Targretin Gel 1% and Panretin Gel 0.1%. These medications were not prescribed by physicians or dispensed to patients and were purportedly dispensed during periods when certain pharmacies were closed.
To conceal over $18 million of their criminal proceeds, Khaim, Khaimov, and their co-conspirators funneled money through several shell companies designed to look like legitimate wholesalers. The funds were typically sent from pharmacy bank accounts they controlled to these sham wholesale companies before being transferred to companies in China for distribution to individuals in Uzbekistan. The defendants then received a corresponding amount of cash from a co-conspirator minus a commission. At other times, the fraudulent proceeds were sent from the sham wholesale companies directly to Khaim, Khaimov, their relatives or designees as certified cashier’s checks or cash. They used the proceeds of the scheme to purchase real estate and luxury items.
Khaim pleaded guilty on Nov. 3, 2022, to one count of conspiracy to commit money laundering. Khaimov pleaded guilty on Nov. 16, 2022, also to one count of conspiracy to commit money laundering. At sentencing, Khaim was ordered to pay more than $18 million in restitution and forfeit more than $2.7 million. Khaimov was ordered to pay more than $18 million in restitution and forfeit more than $9.6 million.
Principal Deputy Assistant Attorney General Nicole M. Argentieri; U.S. Attorney Breon Peace for the Eastern District of New York; FBI New York Field Office Assistant Director James Smith; IRS Criminal Investigation Special Agent Thomas M. Fattorusso; HHS-OIG Special Agent Naomi Gruchacz; and FDIC-OIG Special Agent Patricia Tarasca made the announcement.
HHS-OIG, FBI Criminal Investigation Division (CID), IRS-CID investigated the case.
Trial Attorney Arun Bodapati prosecuted the case with assistance from Principal Assistant Chief Jacob Foster and Assistant Chief Patrick Mott of the Criminal Division’s Fraud Section.
The Fraud Section leads efforts against health care fraud through its Health Care Fraud Strike Force Program which has charged over 5,400 defendants who collectively billed federal health care programs more than $27 billion since March 2007.
More information can be found at www.justice.gov/criminal-fraud/health-care-fraud-unit.
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