Unfortunately, we are no longer surprised by the schemes to defraud the government by dishonest individuals and companies. It's simply too commonplace. While it does not appear that this case arose from a whistleblower, it very well could have. Undoubtedly, other people knew what was going on. The False Claims Act allows individuals with inside information of fraud against the government to file suit on behalf of the United States government. If the case is successful, the government shares a portion of its recovery with the whistleblower. Congress added this to the False Claims Act statute in 1986--during the Regan administration--to motivate and incentivize people with inside information to come forward and report the perpetrators. Since the 1986 amendments were enacted, the United States has recovered more than $30 billion that would otherwise be lost to fraud. And nearly 30% of that staggering amount--$8.8 billion—has been recovered since January 2009, with $6.6 billion of that accounting for health care fraud recoveries. Without the courage of whistleblowers who came forward to report these fraudulent schemes, most if not all of this nearly $20 billion would have never been recovered.
Lynnwood couple sentenced for defrauding programs aimed at helping needy
A Lynnwood couple who defrauded state and federal programs designed to assist the needy were sentenced to prison and home confinement Wednesday after being convicted of multiple counts of mail fraud and theft of government funds.
Igor Meyer, 47, and his wife, Zoya Mushailova, 35, each were sentenced to 30 days in prison, six months of home detention and three years of supervised release. The couple had a household income of approximately $100,000 and owned their own home. However, they represented to caseworkers that Meyer was a single father of four with income of less than $12,000 per year, allowing him to collect housing and other government benefits.
At sentencing, U.S. District Judge Robert S. Lasnik said the fraud scheme “has a real corrosive impact on society… both in the attitude of taxpayers and in denying benefits to people who really need them.”
The couple was indicted in October 2011, and the two were convicted following a jury trial in October 2012. Evidence at trial revealed they schemed to defraud programs for the needy of more than $70,000 over three years. The couple purchased a Lynnwood condominium in Mushailova’s name and they used a real estate management company to ‘rent’ it to Meyer, claiming he was a former in-law of Mushailova. Meyer applied for both food and Social Security benefits as a single father of four, claiming the family had no income.
Mushailova not only owned the Lynnwood condo, she also owned a rental property in Arizona, making the family ineligible for aid. Far from being needy, the couple drove luxury cars and took cross country and international vacations. On the day they returned from one such vacation to New York and Mount Rushmore, Meyer submitted a declaration to the housing program claiming Mushailova was his “ex-wife” and he did not know where she lived.
In asking for prison time, prosecutors noted that the average time on the waiting list for housing assistance in Snohomish County is six years. “Defendants exploited social programs intended for the poor. By fraudulently collecting housing benefits they did not need, they denied truly needy families the opportunity to obtain decent housing. They stole funds intended to provide food, cash and medical assistance to the poor. In short, defendants enriched themselves by victimizing the most vulnerable members of the community,” prosecutors wrote in their sentencing memo.