California couple with long history of health care fraud convicted for COVID-19 fraud

A California couple with multiple previous health care fraud convictions launched a $359 million scheme during the COVID-19 pandemic to fraudulently bill government and private insurance programs for expensive and medically unnecessary respiratory pathogen panel tests.

Lourdes Navarro, 64, of Glendale, and her husband Imran Shams both had been previously convicted of health care fraud and were prohibited from billing federal health care programs for years before the COVID-19 scams got underway, according to court records.

Navarro and Shams submitted false and fraudulent claims to Medicare, Health Resources and Services Administration and an insurance company for $359 million. Their company received $69.1 million, according to federal prosecutors. Navarro and Shams made large cash withdrawals and used the money to buy real estate, luxury items, travel, and household expenses.

"Stealing public money is unacceptable in any circumstance, but particularly egregious when taking advantage of a public health emergency," U.S. Department of Health and Human Services Inspector General Christi Grimm said in a statement.

Shams, who is the same age as his wife, was first convicted of health care fraud in 1990 in New York. In that case, Shams was convicted of Medicaid fraud. In 1991, the U.S. Department of Health and Human Services' Office of Inspector General banned Shams from participation in Medicare, Medicaid, and all other federal health care programs for five years, according to court records. The Office of Inspector General further ordered that Shams must apply to the agency for reinstatement.

In 2000, Navarro was convicted of felony grand theft related to billing fraud involving the Medicare and Medi-Cal programs in California. In 2002, the Office of Inspector General banned Navarro from participation in federal health care programs for 15 years and told she would have to apply to the agency for reinstatement, according to court records.

In 2001, Shams was convicted of felony grand theft related to billing fraud involving Medicare and the Medi-Cal program, a California health care program that provided health care benefits to low income people. This time, in 2004, the Office of Inspector General banned Shams from participating in all federal health care programs for 10 years and ordered that he must apply to the agency for reinstatement.

In 2017, Shams pleaded guilty in New York to conspiracy to commit money laundering, conspiracy to receive and pay health care kickbacks, and conspiracy to defraud by obstructing the Internal Revenue Service, according to court records.

Navarro applied for reinstatement through the Office of Inspector General in 2018. Her application was false and fraudulent, according to prosecutors who said she lied on the application about not working in health care during her ban. Based on the false application, she was reinstated, according to court records

From June 2020 to April 2022, Navarro conspired with Shams to obtain nasal swab specimens from residents and staff at nursing homes, assisted living facilities, rehabilitation facilities, and students and staff at primary and secondary schools, for the purported purpose of conducting screening tests to identify and isolate individuals infected with COVID-19, according to court documents.

Navarro and Shams then used Matias Clinical Laboratory, doing business as Health Care Providers Laboratory, to perform respiratory pathogen panel tests on some of the specimens, even though only COVID-19 testing had been ordered and even though there was no medical justification for conducting respiratory pathogen panel tests.

Navarro pleaded guilty to conspiracy to commit health care fraud and wire fraud. She is set to be sentenced on Jan. 23, 2024. She faces up to 20 years in prison.

Shams previously pleaded guilty to conspiracy to commit health care fraud and is scheduled to be sentenced on Jan. 9, 2024, according to court records.

"The defendant used her management position at a clinical testing laboratory to exploit the COVID-19 pandemic for personal gain," Acting Assistant Attorney General Nicole Argentieri of the Justice Department's Criminal Division said in a statement.