Eight defendants are now facing federal fraud charges in connection with allegations of Medicaid fraud carried out by Housing Stabilization Services providers.
Acting U.S. Attorney for Minnesota Joseph Thompson announced on Thursday the first round of charges for people who abused a program that he declared to be “riddled with fraud.”
Those defendants were involved in four companies that billed Medicaid for services that investigators say were not provided:
- Four were indicted for their connection to Brilliant Minds LLC and are accused of collectively receiving more than $2.3 million in Medicaid billings:
- Moktar Hass Aden, 30
- Mustafa Dayib Ali, 29
- Khalid Ahmed Dayib, 26
- Abdifitah Mohamud Mohamed, 27
- A father and son were indicted on suspicion of receiving more than $2.2 million in fraudulent billing through the company Faladcare Inc.:
- Christopher Adesoji Falade, 62
- Emmanuel Oluwademilade Falade, 32
- Two brothers waived their right to a grand jury review and were charged by information. Their companies Leo Human Services and Liberty Plus LLC allegedly stole $2.7 million and $1.2 million, respectively, through HSS billing:
- Asad Ahmed Adow, 26
- Anwar Ahmed Adow, 25
Combined, the defendants are accused of stealing more than $8.4 million.
Thompson said the investigation into fraudulent billing in HSS and other Medicaid-based services continues, and more charges will come “in waves” as prosecutors build their cases against individual companies.
“The level of fraud in these programs is staggering. Unfortunately, our system of trust but verify no longer works,” Thompson said. “These programs have been abused over and over to the point where the fraud has overtaken legitimate services.”
Program background
HSS was established in 2020 as a means of connecting vulnerable adults with housing. The state estimated its annual operating cost to be around $2.6 million, but five years later, providers are billing the program upwards of $100 million per year.
The FBI executed a series of search warrants related to the program back in June as federal authorities looked into providers who were billing for services that clients never received. An affidavit filed at the time attested that HSS was designed to be “an easy-to-obtain benefit” that “has shown to be uniquely vulnerable to fraud.”
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Since then, the Minnesota Department of Human Services announced plans to end HSS entirely.
HSS providers acting in good faith say the fallout could be devastating to the communities they serve and will only serve to increase housing instability.
Republican lawmakers who have hammered Gov. Tim Walz’s administration on mounting fraud in government programs say simply ending the program is not enough to get to the root of the problem. They’ve called for a federal audit of DHS to find out how hundreds of millions of dollars in fraud went unchecked for years.
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