Feds: How an exec bilked Medicare, spent millions

Robert Snell
The Detroit News

Detroit — A health care executive cheated Medicare out of $132 million and blew the money on a $7 million Franklin mansion and courtside NBA tickets, and stuffed secret storage units with cash, prosecutors allege.

Mashiyat Rashid is a venture capitalist, his lawyer says.

Federal court records and prosecutors provided new details about the inner workings and riches of a health-care fraud conspiracy that ranks among the largest in Detroit history, orchestrated by 37-year-old businessman Mashiyat Rashid.

Prosecutors say the conspiracy involved recruiting homeless people as patients, sending phony bills to Medicare, subjecting drug addicts to unnecessary back injections and prescribing powerful pain medication that ended up being sold on the street.

The conspiracy generated so much money that Rashid withdrew $500,000 from a bank this month and stuffed the cash in a duffel bag, the government said. A surveillance team of federal agents watched him enter and leave the bank.

“This was a crime of deceit. His fraud was brazen,” Justice Department trial attorney Jacob Foster said Wednesday during Rashid’s bond hearing. “This was about the thousands and thousands of beneficiaries who were taken advantage of in order for (Rashid) to line his pockets.”

Rashid, who lives in West Bloomfield Township, faces up to life in federal prison if convicted of crimes including health-care fraud conspiracy, money laundering and receiving kickbacks.

Rashid is not a flight risk or a criminal, defense lawyer Mohammed Nasser said. He is a venture capitalist and business owner who paid $2.4 million in taxes last year. Rashid moved to the U.S. from Bangladesh when he was 3 years old, graduated from the University of Michigan, is married and has two young children.

“He doesn’t have as much as a speeding ticket,” Nasser said. “He has had absolutely no involvement with the criminal justice system. This is his first parlay into the gamut of criminal law. We are confident this will be resolved.”

Rashid is a flight risk, U.S. Magistrate Judge Elizabeth Stafford said, noting his international travel, ties to Bangladesh and assets. She ordered Rashid held without bond pending an Aug. 22 trial.

“This is a uniquely troubling case in a lot of ways,” Stafford said. “The allegation is he basically forced people who may have been addicted to drugs to have unnecessary injections in their back as part of this scheme — things of that nature are very troubling.”

The conspiracy dates to 2008, and involved six others and a web of companies controlled by Rashid, prosecutors allege.

The companies included Tri-County Physicians and National Laboratories, which have offices at Detroit’s iconic Fisher Building. FBI agents raided the building Wednesday, among other locations.

Rashid hid his involvement in some companies by placing the firms under phony ownership, according to the government.

Last year, Medicare officials suspended one company, Tri-County Physicians, after a review indicated 100 percent of claims for patient injections should be denied because the procedures were medically unnecessary and lacked documentation, Foster said.

“(Rashid) did not stop his fraudulent scheme there,” Foster said. “Instead he created two new companies, merely changing the name on the door to the existing practice and continued ... circumventing Medicare’s rules and regulations by not disclosing his own involvement with the practice.”

Rashid solicited kickbacks for the referral of patients at labs, home-health agencies and diagnostic centers, the government alleged.

“Health care providers who generate profits through dishonest practices jeopardizing the wellbeing of patients will be identified, discredited, and brought to justice,” David Gelios, head of the FBI’s field office in Detroit, said in a statement Thursday.

Prosecutors say the scheme was wildly profitable. In all, Rashid transferred $10 million into his personal bank accounts, the government alleged.

Mashiyat Rashid is building a $6.8 million house in Franklin. Prosecutors say he orchestrated one of the region’s largest cases of health-care fraud.

“What did (Rashid) do with the proceeds of the scheme? He used the proceeds of the scheme to spend hundreds of thousands of dollars to sit courtside at NBA basketball games, to make $6.6 million in investments and to finance the construction of a $6.8 million house,” Foster said.

The 10-count indictment, unsealed Wednesday, appears to have disrupted construction on Rashid’s 10,300-square-foot estate near 13 Mile and Crestwood in leafy Franklin.

On Friday, there were no workers at the towering, unfinished mansion. Architectural plans show the home will include an indoor subterranean basketball court.

The home’s footprint takes up so much space that a pile of excavated dirt stacked in the backyard is taller than a bungalow.

It is unclear whether Rashid will ever move into the home.

A 10,000-square-foot home near 13 Mile and Crestwood in Franklin is being built by Mashiyat Rashid, but work has halted.

On Thursday, federal prosecutors filed paperwork in Oakland County that could end with the home being forfeited to the government.

Rashid’s Facebook page offers insight into the businessman’s luxury lifestyle. One photo shows Rashid sitting courtside at Game 7 of last year’s NBA Finals between the Golden State Warriors and Cleveland Cavaliers at Oracle Arena in Oakland, California.

“Priceless,” he posted.

His Facebook profile photo shows Rashid standing next to a Rolls Royce and a private jet in September 2016.

Prosecutors say Mashiyat Rashid, right, spent hundreds of thousands to travel by jet and to build a house. His assets have been seized. (other man's face intentionally blurred)








Rashid posted that he flew in the jet for a golf trip at Treetops Resort in Gaylord.

In the post, Rashid clarified that he did not own the jet.

“Not worth purchasing,” he wrote. “I don’t travel as much...I wouldn’t get my monies (sic) worth.”

Federal agents had Rashid under surveillance earlier this month and watched him travel to a Bank of America branch.

Agents spotted him leaving with a duffel bag. A bank employee told investigators Rashid withdrew $500,000 in $100 bills.

“This is merely indicative of the financial assets and the flight risk (Rashid) poses,” Foster said.

Rashid legally withdrew the cash so he could reinvest in his companies, his lawyer said.

“He could have easily withdrawn millions from his account,” Nasser said, “but he did not.”

The indictment and Rashid’s arrest happened despite an intricate emergency plan he shared with a confidential FBI witness.

“If he was ever arrested, he would have a plane ready to take him outside the United States,” Foster said. “(Rashid) also stated to this witness that he has storage units full of cash that are maintained in others’ names.”


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