Amtrak Faces Massive $12 Million Fraud Scheme Involving 119 Employees and Doctors

Amtrak’s Workforce Implicated in $12 Million Health Fraud Scheme

At least 119 Amtrak employees and associated doctors have been caught in a significant $12 million health fraud scheme, as uncovered by a recent investigation. This disturbing revelation from Amtrak’s Office of Inspector General has raised serious questions about workplace ethics and accountability within the company.

Details of the Fraudulent Activity

The investigation detailed how employees across several states—including Pennsylvania, Delaware, New Jersey, New York, Maryland, Connecticut, and Washington, D.C.—received cash kickbacks from three healthcare providers. In exchange, they provided their insurance information, including that of their dependents, allowing for fraudulent claims from 2019 to 2022.

Amtrak Inspector General Kevin H. Winters stated, “The sheer volume of employees who cavalierly participated in this scheme to steal Amtrak’s funds suggests not only a serious lapse in basic ethics but a troubling workforce culture, especially in the Northeast region, where such blatant criminal behavior appeared to be normalized.” This alarming statement highlights the depth of the issue.

Healthcare Providers Filed Questionable Claims

The implicated healthcare providers utilized the stolen employee information to submit fraudulent medical claims for services that either were not provided or were medically unnecessary, according to the OIG report. Overall, Amtrak’s health plan suffered more than $16 million in fraudulent bills, resulting in a direct loss of $12 million.

Consequences for Employees Involved

Of the 119 employees involved in this scheme, 28 have retired or resigned following the investigation, while 30 left for unspecified reasons. Additionally, a dozen employees face criminal charges, with seven having pleaded guilty and awaiting sentencing. Disturbingly, 61 of the implicated employees are still employed by Amtrak.

Amtrak’s Response to the Fraud Scheme

In a statement issued to Fox News Digital, Amtrak asserted that it has implemented significant measures to combat medical insurance fraud. The company remarked, “Like many employers, Amtrak urges medical benefit providers and insurers to enhance their efforts to identify suspicious activity and prevent medical insurance fraud.”

Amtrak condemned the reprehensible actions that occurred between 2019 and 2022 and reassured the public that it is taking swift action against all active employees implicated in the investigation. The company also committed to continuous collaboration with the OIG to eliminate fraud, while simultaneously undertaking additional initiatives to address the issue.

Heightened Oversight and Fraud Prevention Measures

The OIG launched its investigation after agents identified unusual billing patterns through data analysis. In particular, three healthcare providers in New York with suspicious billing practices were found to have a disproportionately high number of Amtrak employees among their patients.

Undercover Investigation Reveals the Depth of the Scheme

An undercover agent posing as an Amtrak employee met with Punson Figueroa, also known as “Susie,” a Long Island City acupuncturist, on June 16, 2021. During this meeting, Figueroa instructed the agent to sign his name 30 times for services without dating the signatures, according to the OIG. Following this encounter, Figueroa submitted fraudulent claims to Amtrak’s healthcare plan, claiming the agent had received treatment on at least seven occasions for acupuncture and physical therapy.

On July 29, 2021, during another visit, Figueroa allegedly handed the undercover agent an envelope containing $1,000 as payment. Investigators found that she continued to submit numerous fraudulent claims using the agent’s insurance information.

Legal Ramifications for Healthcare Providers

Figueroa eventually pleaded guilty to charges related to defrauding Amtrak’s healthcare plan, receiving a sentence of three years of supervised release and an order to pay restitution of $9.05 million. Additionally, two other healthcare providers and a medical biller have also admitted guilt in connection with this extensive scheme.

Michael DeNicola, a podiatrist from New York, pleaded guilty on June 29, 2022, to conspiracy to commit healthcare fraud, the distribution of a controlled substance, and unlawful possession of a firearm. Sentencing for him is still pending.

Regina Choi, a medical biller from Woodside, New York, who previously worked for Figueroa, also pleaded guilty to conspiracy to commit healthcare fraud on June 11, 2024. She admitted to submitting false and fraudulent claims to Amtrak and providing cash kickbacks to Amtrak employees, with her sentencing also forthcoming.

Past Warnings About Potential Fraud

The OIG had previously issued reports in 2018 and 2019, indicating that Amtrak needed to enhance measures for identifying fraudulent medical claims sooner. These earlier investigations identified billing patterns that suggested potential fraud among many providers.

Future Steps and Ongoing Investigations

As the fallout from this fraud scheme continues, Amtrak is expected to intensify its efforts to combat such unethical practices. The ramifications of this extensive fraud not only affect financial integrity but also public trust in the railroad company.

Amtrak’s actions moving forward will be crucial in restoring confidence among its employees and the public in its commitment to ethical practices and accountability.