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TRENTON - Attorney General
Anne Milgram and Criminal Justice Director
Deborah L. Gramiccioni announced that a Jersey
City pharmacy owner was sentenced to state
prison today for his role in a scheme in which
two pharmacies billed Medicaid for HIV/AIDS
drugs that were never dispensed.
According to Acting Insurance
Fraud Prosecutor Riza Dagli, Shahid Mahmood,
49, of Jersey City, a co-owner of MLK Pharmacy
on M.L.K. Drive in Jersey City, was sentenced
to three years in state prison by Superior
Court Judge Kevin Callahan in Hudson County.
He also was ordered to pay fines and restitution
in the amount of $300,000. Mahmood pleaded
guilty on June 11 to an accusation that charged
him with second-degree health care claims
fraud.
An investigation led by the
Medicaid Fraud Control Unit of the Office
of Insurance Fraud Prosecutor revealed that
MLK Pharmacy and Ampere Pharmacy on 4th Avenue
in East Orange fraudulently billed Medicaid
for hundreds of thousands of dollars in prescription
drugs. Two men who owned Ampere and were co-owners
with Mahmood of MLK Pharmacy previously pleaded
guilty.
In pleading guilty, Mahmood
admitted that between January 2005 and October
2007, he submitted fictitious bills to the
Medicaid program claiming MLK Pharmacy dispensed
HIV/AIDS medicines and other prescription
drugs to customers, when in reality the drugs
were never dispensed.
Previously, John Borges, 45,
and Abdul Bari, 55, co-owners of MLK Pharmacy
and Ampere Pharmacy, each pleaded guilty to
second-degree health care claims fraud and
third-degree filing a false or fraudulent
New Jersey income tax return. They admitted
they bought prescriptions for HIV/AIDS drugs
from Medicaid participants for a small fraction
of the cost of the drugs, and in turn billed
Medicaid thousands of dollars without dispensing
the drugs.
On Dec. 5, 2008, Judge Callahan
sentenced Bari to three years in state prison
and ordered him to pay $500,000 in fines and
restitution. On June 17, 2009, Judge Michael
A. Petrolle sentenced Borges to three years
in state prison and ordered him to pay fines,
restitution and forfeiture in the amount of
$762,000.
“By defrauding the Medicaid
program, this defendant not only stole tax
dollars, he stole from a program dedicated
to providing health care coverage for persons
who otherwise could not afford it,”
said Acting Insurance Fraud Prosecutor Riza
Dagli. “Such cases are a priority for
the Office of Insurance Fraud Prosecutor.”
Detective Kevin Gannon, Detective
Joseph Jaruszewski and Deputy Attorney General
Erik W. Daab were assigned to the investigation
into this case. Deputy Attorney General Debra
Conrad represented the Office of Insurance
Fraud Prosecutor at the sentencing.
Sgt. James Wrightson and Deputy
Attorney General Carol Stanton Meier were
assigned to the asset forfeiture case for
the Office of Insurance Fraud Prosecutor.
The Jersey City Police Department also assisted
in this investigation. Acting Prosecutor Dagli
thanked the Jersey City Police Department
for their valuable assistance.
The Medicaid program is funded
by the state and federal governments. The
State of New Jersey administers the Medicaid
program through the Division of Medical Assistance
and Health Services and through the Office
of Insurance Fraud Prosecutor’s Medicaid
Fraud Control Unit, which investigates both
criminal and civil Medicaid fraud and abuse
in that program.
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