May 23, 2022

Volume XII, Number 143

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May 20, 2022

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FBI Issues Warnings Regarding COVID-19 Fraud Schemes

The Special Agent in Charge of the Boston office of the FBI, Joseph Bonavolonta, has issued an advisory aimed at alerting and keeping individuals and companies safe in the midst of the COVID-19 pandemic. His memo reported on emerging schemes and frauds being perpetrated by criminals looking to capitalize on the current crisis.

The FBI previously issued an alert to warn government and healthcare industry buyers of rapidly emerging fraud trends related to procurement of personal protective equipment (PPE), medical equipment such as ventilators, and other supplies or equipment in short supply during this time of crisis. 

The latest advisory indicated that law enforcement was seeing an increase in other types of healthcare fraud scams. Apparently, taking advantage of the current stress on the supply chain, fraudsters — acting as vendors — have been promising to sell and deliver equipment they do not have access to in order to capitalize on the urgent need. According to the FBI, suspicious indicators of such fraud may include unusual payment terms (i.e., supplier asking for up-front payments or proof of payment), last-minute price changes, last-minute excuses for delay in shipment (i.e., claims that the equipment was seized at port or stuck in customs), and unexplained source of bulk supply.

Scammers also are utilizing several fraudulent methods to extract personal identifiable information from unsuspecting persons, including robocalls, social media sites, door-to-door promotions, telemarketers, and phishing and malware distributions through digital devices. One approach being used is to pay kickbacks to marketers to obtain personal identifiable information such as Medicare, Medicaid, and private health care insurance identifiers. Once this information is obtained, the subject uses it to submit fraudulent claims to Medicare, Medicaid, and private healthcare insurers for laboratory tests, durable medical equipment, and prescription medications that were never provided.

One specific scam uncovered involved the offering of genetic tests to individuals, to include cancer genomic testing (used to aid in the diagnoses of cancer), and pharmacogenetic testing (used to determine how an individual’s body will react to certain medications). The purported genetic tests are fraudulent or not run at all, and the results were either fictitious or not provided to the patient. The FBI previously released a public service announcement relating to certain healthcare fraud schemes the agency had observed.

In another piece of cautionary advice, the FBI indicated that the posting of personal health information on social media about receiving a COVID-19 test could make people susceptible to fraud schemes. Individuals may then be contacted by persons claiming to be medical professionals who purportedly are informing them of their positive COVID-19 test results. The caller will request healthcare insurance beneficiary identifiers or credit card numbers under a ruse that they will submit a prescription or mail medication. Of course, the goal is only to obtain personal identifiable information.

Finally, callers posing as physicians may offer telemedicine COVID-19 consultations or COVID-19 tests for individuals who have valid coverage through Medicare or a private healthcare insurer. Frequently, the individuals have no symptoms. Individuals are asked to provide their personal identifiable information, including health insurance identifiers. Those who succumb to this fraud scheme may have their Medicare or private healthcare insurance billed for various medical services that were never provided.

Jackson Lewis P.C. © 2022National Law Review, Volume X, Number 107
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About this Author

Paul V. Kelly, Jackson Lewis, white collar criminal defense lawyer, internal investigations attorney
Principal

Paul V. Kelly is a Principal in the Boston, Massachusetts, office of Jackson Lewis P.C. He has extensive experience in white collar criminal defense, internal investigations, complex civil litigation and crisis management. Mr. Kelly is the firm’s White Collar and Government Enforcement Practice Group Leader. A former sports industry executive, he is also one of the firm’s Collegiate and Professional Sports Practice Group Leaders.

617-305-1263
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