Scoundrel Spotlight - COVID-19 Fraudster Lourdes Navarro
This week’s Scoundrel in the Spotlight is Lourdes Navarro and her husband Imran Shams. The married pair ran the LA County medical lab Clinical Laboratory Inc. (also called Health Care Providers Laboratory). Their lab performed COVID-19 screening tests primarily for nursing homes and other facilities catering to the elderly population. Last Thursday (October 5), Navarro pleaded guilty to fraudulently billing the government and private insurance programs during the COVID-19 pandemic for expensive and medically unnecessary respiratory pathogen panel (RPP) tests. Shams previously pleaded guilty to the same charges.
In announcing the guilty plea, the Department of Justice (DOJ) described the scheme in very simple terms. Navarro and Shams obtained nasal swabs for COVID-19 screening tests from residents and staff at nursing homes, assisted living and rehab facilities, and students and staff at primary and secondary schools. They then used those samples to perform RPP tests even though only COVID-19 testing had been ordered and there was no medical justification for conducting RPP tests.
In the summary of criminal charges the DOJ issued last year, apparently the scheme also involved Navarro and Shams paying kickbacks to marketers who facilitated the fraudulent testing by securing specimens from and test orders for the unwitting participants. The government also charged the couple with laundering the proceeds of the scheme through various shell companies making large expenditures on real estate and luxury items.
All in, Navarro and Shams billed Medicare, the government’s COVID-19 Uninsured Program, and private insurance for roughly $359 million for the unnecessary RPP tests. They received roughly $54 million in reimbursement. On top of all this, Shams had been excluded from all participation in Medicare for decades because of prior health care-related criminal convictions.
The government used the guilty plea to reaffirm its strong commitment to going after COVID fraudsters. Attorney General Merrick Garland stressed that “[t]hose who stole from government health programs during the COVID-19 pandemic not only violated federal law, they betrayed the public trust,” and “the Justice Department will continue to find and hold accountable those who defrauded American taxpayers during the pandemic.” HHS Inspector General Christi Grimm added: “Stealing public money is unacceptable in any circumstance, but particularly egregious when taking advantage of a public health emergency.”
Navarro pleaded guilty to conspiracy to commit health care fraud and wire fraud. She is scheduled to be sentenced on Jan. 23, 2024, and faces a maximum penalty of 20 years in prison. The False Claims Act is the government’s primary tool for going after those who defraud the government. The government has used it repeatedly to take down COVID fraudsters, which the DOJ has highlighted as one of its top priorities.
One of the unique features of the False Claims Act is permitting private individuals to file lawsuits on the government’s behalf and in return receive up to 30 percent of any government civil recovery. It is not clear whether a whistleblower was involved in exposing Navarro and Shams. But generally, whistleblowers are responsible for initiating the vast majority of False Claims Act cases. And they have been a major factor in helping the government root out COVID fraud.
If you think might have information relating to possible COVID fraud or any kind of healthcare fraud more broadly and would like to speak to an experienced member of the Constantine Cannon whistleblower lawyer team, please feel free to contact us for a free and confidential consult.
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