Anthony Lazzarino, Peter Wong Indicted in VA Shoe Fraud Scheme

Sacramento, Calif. — A 66-year-old former VA podiatry chief and a 58-year-old shoe company CEO are staring down federal prison time after an 11-count indictment unmasked a nearly seven-year health care fraud scheme that ripped off the Veterans Health Administration. Anthony Lazzarino, ex-Chief of Podiatry at the VA’s Northern California Health Care System, and Peter Wong, founder and CEO of Sunrise Shoes and Pedorthic Service, were indicted Thursday by a federal grand jury on charges including health care fraud, conspiracy to pay and receive kickbacks, and conspiracy to commit wire fraud.

From March 2008 to February 2015, Lazzarino abused his position of trust to steer veterans toward Sunrise Shoes, violating VA policy and lining his own pockets. Instead of ensuring patients received fully customized orthotic footwear, Lazzarino and Wong systematically billed the VA for work that was never done. Veterans were prescribed high-cost orthopedic shoes, but the delivered products lacked required custom components—cutting corners while cashing in on taxpayer dollars.

The scheme went deeper than shoddy footwear. Lazzarino referred patients directly to Wong’s company, forging a backroom agreement to exchange kickbacks for patient referrals. These illegal incentives corrupted the medical referral process, turning patient care into a profit center. Federal prosecutors allege the two conspired to enrich themselves while jeopardizing the health and trust of injured veterans who relied on proper treatment.

Even more brazen, Lazzarino, Wong, and co-conspirator Jai Aing Chen—already convicted after pleading guilty on December 6, 2016—lied to federal officials about the origin of the shoes. They submitted false information during the application process for an estimated $59 million VA contract, concealing where the footwear was actually manufactured. These misrepresentations weren’t bureaucratic slip-ups—they were deliberate lies designed to maintain access to massive government funding.

The case was cracked open by a joint investigation involving the Department of Veterans Affairs, Office of Inspector General, the VA Police Service, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE HSI). Assistant U.S. Attorney Matthew M. Yelovich is leading the prosecution, building a case that exposes systemic vulnerabilities exploited from within the VA system.

If convicted, Lazzarino and Wong each face up to 10 years in prison and a $250,000 fine for every count of health care fraud, plus five years and $250,000 for each of the two conspiracy counts. The court will determine actual sentences based on federal guidelines and statutory factors. For now, the defendants remain presumed innocent until proven guilty beyond a reasonable doubt—but the indictment paints a damning picture of betrayal at the expense of America’s veterans.