Nine Charged in Multi-Million Dollar Medicaid Fraud and Money Laundering Scheme Linked to Apna Adult Daycare of Brighton LLC and Ashiana Social Adult Daycare Inc., both located in Brooklyn.
$38 Million in Alleged Fraudulent Claims.
By – Farooq Mirza
BROOKLYN, NY — Federal prosecutors in the Eastern District of New York have unsealed a sweeping indictment charging nine individuals in connection with an alleged years-long Medicaid fraud, kickback, bribery, and money laundering scheme centered around two Brooklyn-based social adult day care centers that authorities say fraudulently billed millions of dollars to New York’s Medicaid system.
The New York Police and law enforcement agencies have busted several individuals within the Pakistani-American community who considered themselves community activists and servants. These individuals have been charged in a day care fraud scheme. This marks the second major fraud case involving Pakistani-Americans in U.S. history.
The fraud, totaling approximately 38 million dollars, resulted in the initial charging of nine individuals. According to details, Pervez Siddique and Shazia Butt operated their day care centers, Ashiana Day Care/Apna Day care and involved various community members in creating fake accounts to commit Medicaid fraud.
The couple allegedly used the proceeds to purchase properties and buy people’s silence. In one instance, ninety-five thousand prescriptions were fraudulently obtained. They amassed enormous sums of money and politically bribed individuals in New York to secure millions of dollars in grants and kickbacks. They also defrauded the state by generating fake bills from fictitious hotels.
The pair operated with such audacity that they allegedly bought journalists, gave medals and certificates to police officers, and were under constant surveillance by a New York City fraud department.
A few months ago, the FBI conducted a raid and seized all files and records from their day care center. Pervez Siddique was stopped at the airport while attempting to flee the country and was brought back. His partner, Shazia Butt, was seen roaming freely and threatening people.
Just yesterday, a joint operation resulted in the personal arrest of nine individuals, who were presented in court today. Under U.S. law, each person is entitled to bail, and they were released on bail amounting to hundreds of thousands of dollars. Upon their release, they began spreading rumors in the community, claiming they were never arrested and even dressing up in bridal attire to deceive people.
According to the indictment filed on June 12, 2026, the defendants allegedly operated a sophisticated scheme between 2019 and December 2025 through Apna Adult Daycare of Brighton LLC and Ashiana Social Adult Daycare Inc., both located in Brooklyn.
The Defendants Named in the Indictment
- Shazia Bibi, also known as Shazia Wattoo
- Pervez Siddiqui
- Abdul Aziz
- Zebun Ahmed
- Shair Ali
- Josna Begum
- Saira Khatoon
- Atia Shahnaz
Federal prosecutors allege that the defendants conspired to defraud New York Medicaid and managed long-term care (MLTC) plans by paying illegal kickbacks to Medicaid recipients and recruiters, falsifying attendance records, submitting fraudulent claims, and laundering the proceeds through shell companies.
About Social Adult Day Care Centers
Social Adult Day Care (SADC) centers provide services for elderly and disabled Medicaid recipients, including supervision, social activities, meals, and transportation. Under Medicaid rules, providers can only bill for services that are actually rendered, medically necessary, properly documented, and free from illegal kickbacks or inducements.
According to prosecutors, the defendants allegedly violated those requirements on a massive scale.
The indictment alleges that many Medicaid recipients enrolled at Apna Day Care and Ashiana Day Care received cash payments and other inducements to remain enrolled in the programs. Prosecutors claim that numerous beneficiaries never actually attended the centers despite claims being submitted on their behalf.
In some cases, authorities allege that Medicaid recipients were outside the United States on dates when the centers claimed they had received services.
Federal investigators also claim that on certain dates, Apna submitted attendance claims that exceeded the facility’s legal occupancy limits, raising further concerns about the validity of the records.
Marketers and Recruiters
According to Court documents, several defendants worked as marketers and recruiters whose role was to bring Medicaid recipients into the programs.
Prosecutors allege that:
- Zebun Ahmed
- Josna Begum
- Saira Khatoon
- Atia Shahnaz
received illegal payments in exchange for referring Medicaid recipients to Apna and Ashiana Day Care.
The indictment states that recruiters were responsible for ensuring completion of attendance sheets indicating that recipients attended services even when they allegedly did not.
Authorities further allege that staff members, including Shazia Bibi, participated in creating or maintaining falsified attendance records.
Billing Operations Allegedly Managed Through Pakistan
One of the more striking allegations in the indictment concerns the operation’s billing activities.
Federal prosecutors allege that Pervez Siddiqui hired defendant Shair Ali to oversee billing operations for Apna and Ashiana using personnel located in Pakistan.
Investigators claim those billing operations were used to submit fraudulent claims for services that either were never provided, were not provided as billed, or were tied to illegal kickbacks.
The indictment alleges that between 2019 and December 2025, defendants Shazia Bibi, Pervez Siddiqui, Abdul Aziz, and Shair Ali caused the submission of approximately $38 million in false claims to New York Medicaid and managed long-term care plans.
According to prosecutors, Medicaid and MLTC plans paid approximately $38 million based on those allegedly fraudulent submissions.
Federal authorities contend that the payments were secured through false representations regarding attendance, services rendered, and compliance with anti-kickback laws.
Shell Companies and Money Laundering
The indictment further alleges that the defendants used various corporate entities to disguise kickbacks and launder money obtained from the scheme.
Among the companies named in court documents are:
- Proficient Plus Corp.
- Josna & Juthi Associates Inc.
- S & J Family Corp.
- Ata Corporation
According to prosecutors, checks were issued from Apna and Ashiana Day Care accounts to these entities under the guise of legitimate business expenses.
Investigators allege that the funds were then converted into cash and distributed as kickbacks to Medicaid recipients and recruiters.
Court filings state that some payments were disguised as “gifts,” while internal records allegedly used coded terms such as “medicine” and “laddu” to conceal cash distributions.
Prosecutors also cite ledger entries allegedly containing references such as “3C” to denote $300 cash payments.
Concealment of Evidence After Search Warrants
Federal authorities executed search warrants at Apna and Ashiana in December 2025.
Following those searches, prosecutors allege that Shazia Bibi, Pervez Siddiqui, and Shair Ali took steps to conceal evidence.
According to the indictment:
- Bibi and Siddiqui instructed staff members to obtain new cellular phones.
- Ali allegedly instructed an employee to delete data from a cellphone.
Federal prosecutors argue that these actions were intended to obstruct investigators and conceal evidence related to the alleged fraud scheme.
Alleged Kickback Payments
The indictment identifies several financial transactions that prosecutors claim were kickback payments, including:
- $10,000 payment from Shazia Bibi to Atia Shahnaz in August 2022.
- $4,200 payment from Pervez Siddiqui to Zebun Ahmed in May 2024.
- $20,425 payment from Apna to Josna & Juthi Associates in September 2024.
- $6,900 payment from Apna to S & J Family Corp. in April 2025.
- Approximately $4,000 payment allegedly connected to referral activity in November 2025.
Prosecutors contend these payments were linked to recruiting Medicaid beneficiaries and maintaining fraudulent enrollment numbers.
Charges Filed
The indictment includes multiple federal charges, including:
- Conspiracy to Commit Health Care Fraud
- Conspiracy to Defraud the United States
- Paying Health Care Kickbacks
- Receiving Health Care Kickbacks
- Conspiracy to Commit Money Laundering
The charges arise under federal statutes governing health care fraud, bribery, kickbacks, and money laundering.
Asset Forfeiture
Federal authorities are seeking criminal forfeiture of assets allegedly connected to the scheme.
Court documents list funds seized from multiple bank accounts associated with the defendants and the businesses, including accounts at:
- Bank of America
- Capital One
- JPMorgan Chase
- TD Bank
The government is seeking forfeiture of seized cash and financial assets, as well as any additional property determined to be traceable to the alleged criminal conduct.
Prosecutors have also reserved the right to pursue substitute assets if the original proceeds cannot be located or have been transferred.
The case is being prosecuted by the U.S. Attorney’s Office for the Eastern District of New York in conjunction with the Department of Justice’s Fraud Section.
The indictment was signed under the authority of U.S. Attorney Joseph Nocella Jr. and Department of Justice officials overseeing health care fraud enforcement.
An indictment contains allegations only. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case will now proceed through the federal court system, where prosecutors must present evidence supporting the allegations contained in the indictment.
