DOJ Fraud Division Issues Directive on Corporate Enforcement Strategy

DOJ Fraud Division Issues Directive on Corporate Enforcement Strategy

On October 1, Assistant Attorney General Colin M. McDonald issued Directive 26-12, outlining the US Department of Justice (DOJ) Fraud Division’s approach to corporate enforcement in combating fraud. The directive emphasizes an “aggressive, all-tools approach” to investigating and prosecuting health care, government, tax, and trade fraud, while balancing enforcement with protections for law-abiding businesses.

In August 2026, the DOJ announced the creation of the Fraud Division’s new Corporate Enforcement Section. The new October 1 directive explains that the Corporate Enforcement Section will lead corporate investigations across the Division’s fraud portfolio, ensure consistent application of DOJ policies, and evaluate compliance with corporate resolutions. Fraud Division prosecutors are required to report ongoing corporate investigations to the Section and notify them of any new investigations or major developments.

The directive also establishes enforcement priorities, directing prosecutors to focus on fraud involving the health care industry, public trust and government functions, significant revenue evasion, and tariff or importation fraud. When recommending outcomes in corporate matters, prosecutors must weigh factors including management involvement in misconduct, efforts to conceal fraud, conduct lasting three years or more, threats to American safety or security, financial harm to taxpayer-funded programs, multi-jurisdictional conduct, and harm to victims or losses exceeding $25 million.

Additionally, the directive instructs Division leadership to develop policies and programs that incentivize whistleblowers to bring forward credible information regarding fraud, leveraging technology and data analytics through the National Fraud Detection Center to proactively generate leads and open new investigations.

Read the directive here.

Fast Lab Technologies COO Pleads Guilty to Conspiracy to Commit Health Care Fraud in COVID-19 Testing Scheme

On September 23, Hasan “Lucas” Seyhun, of Miami, Florida, pleaded guilty to one count of conspiracy to commit health care fraud. According to the plea agreement, Seyhun served as the COO of New York-based Fast Lab Technologies, LLC, a purported clinical diagnostic laboratory that he and CEO Cemhan “Jimmy” Biricik created in 2021. According to the DOJ, Fast Lab offered individuals “no cost” COVID-19 tests ordered online after providing their insurance information. Fast Lab then used that insurance information to bill Medicare, Medicaid, TRICARE, the Federal Employees Health Benefits Program, and private benefit programs falsely for services that were largely never rendered, including “false claims that antigen tests had been observed by medical professionals, that saliva samples had been collected by medical personnel,” and “that PCR testing had been conducted on those samples.”

The scheme allegedly ran from approximately 2021 through March 2024. According to the DOJ, it involved over $500 million in fraudulent claims to government-backed health care programs, resulting in at least $35 million in illicit payments. Seyhun admitted that he conspired with Fast Lab CEO Biricik and Medical Director Dr. Martin Perlin to carry out the scheme. The plea agreement establishes that Seyhun acted as a manager or supervisor of the criminal activity, directing internal employees and third-party billing agents to submit fraudulent claims to health care benefit programs.

As part of the plea agreement, Seyhun agreed to a personal forfeiture money judgment of $4,313,153, representing the amount of money he personally received from the scheme. The plea agreement also provides for at least $35 million in restitution to the US Department of Health and Human Services and other health care benefit programs that will be identified at sentencing. Seyhun faces up to 10 years in prison and up to three years of supervised release.

The case is United States v. Seyhun, No. 5:25-cr-20543 (E.D. Mich.).

Read the DOJ’s press release here.

IBX Agrees to $22.5 Million FCA Settlement Over Medicare Advantage Risk Adjustment Data Practices

On September 30, the DOJ announced that Independence Blue Cross (IBX), a Pennsylvania-based corporation that owns and operates Medicare Advantage (MA) organizations, entered into a settlement agreement to pay $22.5 million to resolve allegations that it violated the False Claims Act (FCA). The case originated as a qui tam action filed on November 18, 2020.

The government alleged that IBX knowingly submitted or caused to be submitted false claims and made false attestations related to risk adjustment data from 2016 through 2020. According to the government, IBX operated a retrospective chart review program known as “IBX Review” to review medical records and identify additional risk-adjusting diagnosis codes that health care providers had not originally reported. While IBX submitted the additional codes found through these chart reviews to the Centers for Medicare & Medicaid Services (CMS), it allegedly failed to investigate or withdraw unsubstantiated or invalid diagnosis codes that its nurse reviewers did not find support for in the medical records. The government contends that IBX submitted false certifications to CMS ensuring its data was truthful, complete, and accurate. 

IBX denied the allegations, and the settlement is not an admission of liability.

The case is United States ex rel. Crawford v. Independence Blue Cross, No. 20-cv-5818 (E.D. Pa.).

Read the DOJ’s press release here.

Texas Mental Health Clinic Owner Found Guilty of $26 Million TRICARE Fraud Scheme

On September 24, a federal jury in Fort Worth convicted Kevin D. Curry, 64, of Frisco, Texas, a licensed professional counselor and owner of two mental health clinics in Texas operating as Acuity TMS and one in Florida operating as Emerald Coast TMS (Acuity), for orchestrating a $26 million scheme to defraud the TRICARE military health benefits program. According to the DOJ, Curry billed TRICARE for transcranial magnetic stimulation (TMS) therapy “that was medically unnecessary or never provided.” Curry falsely held himself out as a medical doctor and used actual physicians’ credentials without their knowledge or consent to submit claims. He also instructed employees to fabricate medical records in order to justify the fraudulent billings. Acuity ultimately billed TRICARE over $26 million in false, fraudulent, and kickback-tainted TMS claims, of which TRICARE paid approximately $17 million.

According to the government, to induce patients to participate in the scheme, Curry offered and paid over $5.5 million in kickbacks to veterans, active-duty servicemembers, and their family members for consent to TMS therapy for which they did not qualify and, in many instances, did not receive. Curry then allegedly laundered some of the proceeds, spending his ill-gotten gains on hotels, a lavish casino-themed party, and a gold-plated vehicle worth over $100,000. The jury convicted Curry on all nine counts charged: three counts of health care fraud, three counts of offering and paying illegal health care kickbacks under the Anti-Kickback Statute, and three counts of engaging in monetary transactions in criminally derived property. Curry faces a maximum penalty of 10 years in prison per count and is scheduled to be sentenced at a later date.

The case is United States v. Curry, No. 4:26-cr-00182-O-BP (N.D. Tex.).

Read the DOJ’s press release here.

Dentist Charged With Stealing Over $300,000 From New York Medicaid

On September 28, New York Attorney General Letitia James announced the arrest of Suleman Nasimi, of Hicksville, New York, a Queens dentist who allegedly stole approximately $381,543 from Medicaid through his practice, Tooth Fresh Meadows. According to the state, from January 2020 through August 2024, Nasimi submitted false claims to Medicaid for dental procedures he never performed, including porcelain crown installations and root canals. As a result of Nasimi’s alleged fraudulent claims, several patients were unable to receive the dental care they required because Medicaid records showed they had already obtained the procedures for which Nasimi had billed.

Nasimi and Tooth Fresh Meadows were arraigned on two separate 40-count felony complaints in Queens County Criminal Court. Both were charged with one count of grand larceny, four counts of health care fraud, and 35 counts of offering a false instrument for filing. If convicted, Nasimi faces five to 15 years in state prison.

Read the New York Attorney General’s press release here.

The charges against Nasimi are merely allegations. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.