A prominent Pakistani-American businessman and several associates have been charged with running a massive $38 million Medicaid fraud scheme through two adult day care centers in Brooklyn, the New York Post reports.Pervez Siddiqui, 78, is a prominent community leader. He is a drugstore owner and a member of Brooklyn’s Community Board 13. He was arrested on Monday along with seven alleged co-conspirators. The organization used two social adult day care centers (APNA Adult Day Care Centers and Ashiana Social Adult Day Care Centers) to submit millions of dollars in fraudulent Medicaid claims between 2019 and December 2025.The operation recruited older Medicaid recipients who rarely visited these facilities. In return for enrolling, many participants received cash payments funded by fraudulent Medicaid reimbursements.Also named in the indictment are Shazia Bibi, also known as Shazia Wattoo, Abdul Aziz, Shair Ali, and recruiters Zebun Ahmed, Josna Begum, Saira Khatoon and Atia Shahnaz.Recruiters received kickbacks to enroll Medicaid beneficiaries in the program. The defendants subsequently billed New York’s Medicaid system for services that were never provided, generating approximately $38 million in false claims.To hide the scheme, the organization created false attendance records and sign-in sheets, sometimes exceeding the facility’s legal occupancy limits. They used Pakistani bookkeepers to move funds through shell companies, using payment methods labeled as “gifts,” “dividends,” “medicines,” and even the South Asian sweet “laddu.”After federal agents executed search warrants in December 2025, some of the defendants tried to hinder the investigation by telling employees to change phones and delete data.A source familiar with the investigation told the New York Post that recruiters sought out Medicaid recipients in low-income neighborhoods, bus stations, doctors’ offices and public housing developments.“Marketers go around looking for Medicaid cards. They stop people on the street, at bus stops. They walk into doctors’ offices. They walk into NYCHA [government housing] They know people are low-income. They asked, ‘Do you have a Medicaid card?’ ‘” a source told the New York Times.Sources said seniors or their relatives would receive about $500 a month simply for allowing their Medicaid information to be used.Even more strikingly, prosecutors said some beneficiaries continued to make claims while living overseas.“The patients are in Pakistan, they are in Morocco. They are not even in this country,” the source said.The case also raised eyebrows because of Siddiqui’s political connections. The businessman owns about 15 pharmacies in New Jersey and has donated thousands of dollars to Democratic political campaigns over the years. Through his involvement with the American Pakistan Public Affairs Committee, he attended meetings and events with Democrats, including New York City Mayor Zoran Mamdani, Attorney General Letitia James and former Mayor Eric Adams.No elected officials have been accused of wrongdoing, and no officials are named in the indictment.The indictment also does not accuse Siddiqui’s pharmacy or other affiliated businesses of engaging in fraud.The charges come as New York’s adult day care industry comes under increasing scrutiny. Last year, federal prosecutors charged the operator of another Brooklyn-based plan with allegedly stealing $68 million from Medicaid through similar tactics. Earlier this year, two Queens men were charged in a separate case in connection with a $120 million fraud involving adult day care centers.New York State spends more Medicaid dollars per patient than any other state, making the program a frequent target of large-scale fraud investigations.
