Brooklyn Woman Admits to Orchestrating $68 Million Medicaid Fraud

BROOKLYN, NY – Zakia Khan, a Brooklyn woman, pleaded guilty in federal court today to masterminding a brazen $68 million fraud scheme that bilked Medicaid through a network of kickbacks and bribes. Khan, the owner of two Coney Island social adult day care centers, Happy Family Social Adult Day Care Center Inc. and Family Social Adult Day Care Center Inc., now faces up to 15 years behind bars.

The U.S. Attorney’s Office for the Eastern District of New York detailed how Khan and her team referred Medicaid recipients to her centers, allegedly providing services that were either unnecessary or never rendered. The scheme ran from approximately October 2017 through July 2024, utilizing a home health care fiscal intermediary, Tanwee Services Inc., to launder the ill-gotten gains. The operation wasn’t about care; it was about cash.

As part of the plea agreement, Khan has agreed to forfeit a staggering $5 million, including multiple properties and over $300,000 in cash and gold jewelry seized during a raid of her home. This isn’t just about jail time; it’s about stripping her of the assets built on the backs of a broken system. The case was heard before United States District Judge Natasha C. Merle.

“With today’s guilty plea, Khan stands convicted of acting as the ringleader of a scheme responsible for stealing millions of dollars dedicated to the government’s health care safety net,” stated United States Attorney Joseph Nocella, Jr. “Our Office and the Justice Department take seriously our responsibility to protect government funds from the clutches of fraudsters and will vigorously prosecute corrupt health care operators like the defendant.” The sentiment is strong, but will it translate into real change for a system riddled with abuse?

Federal investigators from multiple agencies – the Department of Health and Human Services Office of Inspector General (HHS-OIG), Homeland Security Investigations (HSI New York), and the New York City Police Department (NYPD) – collaborated on the investigation. “Social adult day care and home health services are intended to support seniors, not serve as vehicles for fraud,” stated Christian J. Schrank, Deputy Inspector General for Investigations at HHS-OIG. “The defendant’s actions are an affront to hardworking taxpayers.”

“Zakia Khan stole $68 million from the Medicaid program through bribes and kickbacks—money meant to support the most vulnerable,” added NYPD Commissioner Jessica S. Tisch. “This fraudulent cash grab exploited a federal health care system that people depend on.” The guilty plea serves as a warning: exploit the system, and you will face the consequences. But for every Khan brought to justice, how many more are still operating in the shadows?

RELATED: $68M Medicaid Scam: Brooklyn Operator Zakia Khan Admits Guilt