Uday Shah, Kickbacks, Kentucky 2020

Busted: Toxicology Lab Owner and Marketer Sentenced for Payment of Kickbacks; Doctor Pleads Guilty to Receipt of Kickbacks

Lexington, KY – Several defendants were recently convicted or sentenced for their roles in a conspiracy to violate the federal Anti-Kickback Statute. On December 4 and December 7, 2020, Uday Shah, 66, of Houston, Texas, and Timothy Andrews, 57, of Deer Park, Texas, were sentenced by Chief United States District Judge Danny C. Reeves to 24 and 15 months’ imprisonment, respectively, for their roles in a conspiracy to pay kickbacks to a physician, Dr. Ghyasuddin Syed, in exchange for Dr. Syed’s referral of urine drug testing to laboratories operated by Shah.

According to their plea agreements, Shah owned and operated several toxicology laboratories, including Pinnacle Laboratory in Lexington. Andrews worked as a marketer on behalf of Shah’s labs. Shah and Andrews admitted that between November 2014 and August 2017, they paid $475,992 in kickbacks to Dr. Syed, a Houston-area physician, and Dr. Syed’s wife, Shazana Begum. The kickbacks were often disguised as lease payments for office space owned by Dr. Syed and Begum.

All of the defendants agreed that Pinnacle and Shah’s other labs billed the Medicare program for the urine drug testing tainted by these kickbacks, and that Medicare paid the labs $325,739 to which they were not entitled. Andrews pleaded guilty in June 2019, and Shah pleaded guilty in October 2019. In addition to their respective terms of incarceration, Shah and Andrews were ordered to pay $325,739 to the Medicare program in restitution, jointly and severally.

Dr. Syed is scheduled to be sentenced on March 12, 2021, in Lexington. He faces up to five years in prison for the conspiracy to violate the Anti-Kickback Statute, and a maximum fine of $250,000. However, any sentence will be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the applicable federal sentencing statutes.

Defendant Information:

Uday Shah, 66, of Houston, Texas

Charge: Conspiracy to pay kickbacks to a physician in exchange for referrals

Sentence: 24 months in prison

Location: Lexington, KY

Date: December 4 and December 7, 2020

Amount: $475,992 in kickbacks paid to Dr. Syed and Dr. Begum

Restitution: $325,739 to the Medicare program

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