Ferrari, luxury homes and fake rides: Mount Sinai businessman sentenced in $19M Medicaid fraud

A Mount Sinai business owner has been sentenced to 8 years and 1 month in prison for orchestrating a scheme that stole more than $19 million from Medicaid and using the money to buy multiple houses, a Ferrari and other luxury cars.

Adnan “Eddie” Arshad, 47, also was ordered by U.S. District Judge Joan M. Azrack to pay restitution of $19.7 million and forfeiture of $19.7 million, which includes a $1.8 million home in Mount Sinai and vehicles he purchased with the misappropriated funds.

"Those who defraud public healthcare programs for personal enrichment should take notice of the price this defendant will now pay for his greed," the U.S. attorney for the Eastern District of New York, Joseph Nocella Jr., said after Tuesday's sentencing in federal court in Central Islip.

Arshad's attorney declined to comment on Wednesday.

Arshad pleaded guilty a year ago to conspiracy to commit healthcare fraud and conspiracy to commit money laundering. He faced up to 20 years in prison.

Arshad and his co-conspirators ran two transportation companies — 668 MTK Taxi LLC in Montauk and All-Star Taxi LLC in Ronkonkoma — that submitted false billing claims for taking patients to and from addiction treatment centers. The claims included fake pickup addresses and at least three treatment centers in New York City instead of ones on Long Island to boost the amount sought from Medicaid, according to court filings.

To conceal the fraud, the conspirators staged "ghost rides," where they would drive lengthy routes to create GPS data that falsely appeared to corroborate the trips that Medicaid was billed for, the filings show.

The scheme took place between December 2020 and Arshad’s arrest in June 2024. He and his co-conspirators paid kickbacks — sometimes totaling $300 per trip — to the patients ordering transportation for their methadone treatments at the addiction centers. No transportation was provided in many instances, according to the filings.

Some of the patients whose names were on the claims were dead, hospitalized or in prison, the filings show.

Federal prosecutor Adam Toporovsky, in a sentencing memo to the judge, said Arshad may have conspired with others, but he "was the driving force" who "directed [the fraud scheme's] execution and ultimately pocketed the vast majority of the proceeds."

Arshad's attorney Shrey Sharma acknowledged his client's wrongdoing but said it was "entirely inconsistent with the honorable manner in which he has lived his life."

In a memo to the judge, Sharma called Arshad an "upstanding and model citizen."

The attorney also said Arshad would be destitute after paying restitution and forfeiting his family's home in Mount Sinai, two other properties, $888,863 in cash and 11 vehicles.

Five of Arshad’s seven co-conspirators, most of whom were employed by his companies, have pleaded guilty and await sentencing. However, one died after his February 2025 plea hearing and the charges against him were subsequently dismissed, according to court filings

Two other co-conspirators have pleaded not guilty and their cases continue. Of the seven, all but one lives on Long Island, the filings show.

After Arshad's sentencing, Suffolk County District Attorney Ray Tierney, whose office helped to prosecute case the case, said, "Healthcare fraud on this scale does not stay hidden, and it will not go unpunished."

Naomi Gruchacz, a special agent for the U.S. Department of Health and Human Services' inspector general, said the department would continue to pursue "individuals who, to satisfy their own greed, exploit federal healthcare programs."

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.