A man who worked for the company Gov. Tim Walz recently hired to audit Minnesota’s Department of Human Services (DHS) programs at risk for fraud has been convicted of fraud.
Karan Gupta, 47, a former senior director at Optum, a subsidiary of UnitedHealth Group, was found guilty after a six-day trial on multiple counts, including fraud and money laundering conspiracy, announced United States Attorney Daniel Rosen this week.
Gupta hired an unqualified friend for a position where the friend did no work and paid half his unearned salary in kickbacks to Gupta, whose fraud totaled more than $1.2 million, a press release from the U.S. attorney said.
Details from the case revealed that Gupta was a senior director of data analytics at Optum, Inc., a subsidiary of UnitedHealth Group, which is headquartered in Minnesota. At Optum, Gupta earned an annual salary of more than $260,000 at the height of his career.
In 2015, Gupta recruited and approved the hiring of a lifelong friend, Shangraf Kaul, to work at Optum in a managerial data engineering position. Gupta provided Kaul with a false resume, which Kaul used to secure the position, and Gupta became Kaul’s supervisor.
For nearly four years, Kaul did no work at all for Optum, all while collecting a salary that began above $100,000 and increased with raises and bonuses each year. Kaul met no one else at Optum, sent almost no emails, and regularly did not log into his Optum computer for weeks on end. Charging documents state that Kaul resided in New Jersey at all times relevant to the conspiracy and was working full-time for a technology services and consulting company based in New Jersey.
Gupta and Kaul agreed that Kaul would share more than half of his unearned Optum salary in kickbacks to Gupta. After initially withdrawing cash that was deposited by Kaul into Gupta’s bank as a kickback, a plan was hatched to conceal the kickback payments in a separate bank account, to which Kaul granted Gupta access through the use of a debit card. Gupta used the card to make cash withdrawals from ATM machines.
The fraud scheme was discovered after Gupta was terminated in November 2019 for a separate fraud by Gupta that Optum discovered. Optum investigated and referred the case to federal law enforcement.
“Those who manufacture fraudulent schemes to appropriate money from legitimate businesses must be held accountable for their criminal conduct,” said Rosen. “Kickback schemes and no-show jobs undermine legitimate businesses, and the perpetrators must suffer the consequences of their actions.”
Gupta was found guilty Tuesday on one count of conspiracy to commit wire fraud, 10 counts of wire fraud, and one count of money laundering conspiracy. A sentencing hearing for Gupta has not yet been scheduled.
Kaul pleaded guilty last year under the terms of a plea agreement but does not appear to have been sentenced yet.
Minnesota Medicaid fraud investigation by Optum
Late last year, Gov. Tim Walz ordered a “third party” audit of 14 Medicaid programs administered by DHS, which were determined to be at high risk for fraud.
Walz contracted with Optum to conduct the analysis of the programs to identify irregularities such as missing documentation, unusually high billing patterns, or inconsistencies suggesting that a claim may not meet program requirements.
UnitedHealthcare, which is a subsidiary of UnitedHealth Group (UHG), previously partnered with the State of Minnesota on health plans that included Medicaid services. Optum is also a subsidiary of UHG.
Last month, Alpha News senior reporter Liz Collin interviewed attorney Dr. David Feinwachs on Medicaid fraud in Minnesota.
“The root cause of all fraud in Minnesota is the absolute total absence of financial safeguards. There just aren’t any there. Zero,” Dr. Feinwachs said. “What’s interesting is this isn’t by accident. This is intentional.”
Multiple federal agencies are investigating the levels of fraud in Minnesota, and as recently as last week, Border czar Tom Homan confirmed that the fraud work is continuing, as he discussed ICE and Border Patrol’s drawdown of their Metro Surge operation in the state.
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Minnesota Crime Watch & Information publishes news, info and commentary about crime, public safety and livability issues in Minneapolis, the Twin Cities and Greater Minnesota.
Crime Watch MN
Minnesota Crime Watch & Information publishes news, info and commentary about crime, public safety and livability issues in Minneapolis, the Twin Cities and Greater Minnesota.
