Texas Businessman Accused of $1.9 Million COVID Test Kit Fraud

ST. LOUIS - A Texas businessman has been indicted in St. Louis and accused of fraudulently seeking more than $4.5 million from Medicare for COVID test kits and obtaining more than $1.9 million.

Rashid Naqvi, 51, of the Houston area, was indicted in U.S. District Court in St. Louis on September 4 on four counts of wire fraud conspiracy and one count each of obstruction of a federal audit and conspiracy.

He appeared in court Wednesday and pleaded not guilty.

The indictment accuses Naqvi of fraudulently obtaining $1,974,479 from Medicare from March 2023 through September 2024 by billing for sending numerous COVID-19 test kits to patients who had never requested them. Many of the patients were dead, the indictment says. Naqvi obtained victims' Medicare Numbers and identifiers without their knowledge or consent by paying a total of $488,435 in illegal kickbacks to co-conspirators, the indictment says. It says Naqvi used two laboratories that he owned to submit the false claims to Medicare, Elite Diagnostics Inc. in Missouri and Astro Diagnostics Inc. in the Southern District of Texas.

The indictment says Naqvi attempted to conceal his scheme by disguising kickback payments as payments for COVID test kits, creating a sham contract with one of the companies supplying the information and submitting false documents to Medicare investigators during an audit. He continued submitting false claims to Medicare even after patients called to tell him that they did not request or want the test kits, the indictment says. Naqvi sought a total of $4,579,850 from Medicare.

Charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.

Wire fraud is punishable by up to 20 years in prison, a $250,000 fine, or both. Obstruction of a federal audit and conspiracy are each punishable by up to five years in prison and a $250,000 fine.

"Today's indictment reflects our unwavering commitment to safeguarding Medicare and ensuring that its resources are used appropriately," said Linda T. Hanley, Special Agent in Charge, U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG). "There are serious consequences for individuals who seek to manipulate federal health care programs by exploiting enrollees' personal information and participating in illegal kickbacks. HHS-OIG is committed to working with our law enforcement partners to hold those accountable who undermine the integrity of our health care system."

The FBI and the U.S. Department of Health and Human Services Office of Inspector General investigated the case. Assistant U.S. Attorney Derek Wiseman is prosecuting the case.