NEWARK, NJ—A Passaic County, New Jersey, man was charged today with operating a lucrative ambulance company that received funds from Medicare and Medicaid, despite being barred from doing such business because of a prior health care fraud conviction, U.S. Attorney Paul J. Fishman announced.

Imadeldin Awad Khair, a/k/a “Nadr Khair,” 55, of Clifton, New Jersey, was indicted by a federal grand jury in Newark. The 17-count indictment charges Khair with one count of health care fraud, one count of obstruction of a federal audit, eleven counts of tax evasion and four counts of money laundering.

According to the documents filed in this case and statements made in court:

As a result of his 2003 conviction on a New Jersey state health care charge, Khair was excluded from participating in any capacity in Medicare, Medicaid, or other federal health care program for a minimum of 11 years. Despite this, Khair has since 2005 been an operator and a de facto owner of K & S Invalid Coach, a licensed ambulance and wheelchair transportation service operating out of Clifton. Nearly all of K & S’s patients were Medicare or Medicaid beneficiaries requiring regular transportation to dialysis treatment. Since September 2011, Medicare has paid more than $6.5 million in claims submitted by K & S. Since January 2010, N.J. Medicaid has paid more than $1 million in claims submitted by K & S. In 2014 alone, K & S received more than $2.6 million from Medicare and N.J. Medicaid and was in the top 3 percent of the more than 400 a.m.bulance transport providers in the state of New Jersey, as measured by receipt of payments from Medicare.

Since at least 2005, Khair and others at K & S concealed his involvement in the company from Medicare and N.J. Medicaid, including his substantial control over K & S’s bank accounts and operations, including the authority to hire and terminate employees, determine employee salaries, and enforce company policies. Khair also paid several K&S employees, and nearly all of the employees’ overtime wages, “off the books” and without withholding the necessary payroll taxes. In order to carry out the tax evasion, Khair paid the “off the books” wages via cash or handwritten check and directed K&S employees to underreport to the company’s payroll company the actual number of hours worked.

In response to a U.S. Department of Labor audit of K&S in 2014, Khair held an employee meeting wherein he directed the K&S employees to falsely state to the Department of Labor that they never worked more than 80 hours in a biweekly pay period. Khair also directed K&S employees to alter and falsify K&S timekeeping records to match the false amounts previously reported to the company’s payroll vendor.

The indictment also charges money laundering arising from K&S checks that were written and endorsed by Khair and made payable to “cash” or Khair himself, which were used to pay the “off the books” wages and enrich Khair personally.

The health care count with which Khair is charged carries a maximum potential penalty of

10 years in prison. The obstruction of a federal audit and tax evasion counts each carry a maximum potential penalty of five years in prison. The money laundering counts each carry a maximum potential penalty of 20 years in prison. All the counts also carry a fine of $250,000, or twice the gain or loss from the offense.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel in Newark; special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and special agents of IRS-Criminal Investigation, under the direction of Jonathan D. Larsen, with the ongoing investigation leading to these charges.

The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, and Assistant U.S. Attorney Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.

U.S. Attorney Fishman reorganized the health care fraud practice shortly after taking office, creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $635 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.