The U.S. Justice Department has indicted three individuals who are linked to California hospices on alleged False Claims Act violations, among other charges.
Karen Sarkisyan, Gayk Akhsharumov, and Babken Chalkadryan, of San Gabriel Hospice & Palliative Care and Broadway Hospice were each charged in the U.S Central District Court of California with conspiracy to commit wire fraud, wire fraud, conspiracy to commit health care fraud, health care fraud, conspiracy to commit money laundering, and money laundering for their roles in an alleged scheme to submit false Medicare claims.
Sarkisyan and Akhsharumov were also charged with wire fraud and theft of government property for their roles in an alleged scheme to fraudulently obtain funds from the Paycheck Protection Program, which the federal government established during the COVID-19 public health emergency.
“The Criminal Division and our partners are committed to identifying and holding accountable those who exploit the COVID-19 pandemic for their own gain,” said Assistant Attorney General Kenneth A. Polite, Jr., of the Justice Department’s Criminal Division. “As these cases demonstrate, we are unwavering in our determination to prosecute those who have defrauded relief programs meant to help struggling Americans during the pandemic.”
The Coronavirus Aid, Relief, and Economic Security (CARES) Act dedicated more than $2 trillion in economic relief during the COVID-19 pandemic. The Act originally authorized up to $349 billion in forgivable loans to small businesses through the Paycheck Protection Program (PPP), and Congress later authorized $321 billion in additional PPP funding.
The Justice Department is now investigating allegations of widespread fraud in how some of those funds were used, as well as possible instances involving the Provider Relief Fund.
According to court documents, between January 2018 to May 2021, the defendants allegedly used the two Los Angeles-based hospice companies to submit more than $9 million in false and fraudulent claims to Medicare.
Additionally, Sarkisyan and Akhsharumov allegedly submitted fraudulent PPP loan applications on behalf of San Gabriel Hospice to the Small Business Adminsitration and to a financial institution and misused approximately $91,483 in other COVID-19 relief funds.
The top count carries a maximum penalty of 20 years in prison. If convicted, a federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The U.S Department of Health and Human Services, Office of Inspector General (HHS-OIG) and the FBI are investigating the case. Fraud Section Trial Attorneys Patrick J. Queenan and Alexandra Michael are prosecuting.