CHICAGO — A Chicago-based laboratory owner has been sentenced to seven years in federal prison for orchestrating a massive COVID-19 testing fraud scheme that exploited a federal relief program, authorities confirmed this week.
Zishan Alvi, 46, admitted to submitting over $14 million in fraudulent claims to the Health Resources and Services Administration (HRSA) during the pandemic by billing for COVID-19 tests that were either never conducted or done improperly.
Fraudulent Testing, Faked Results
According to federal investigators, Alvi’s laboratory issued negative COVID-19 test results to patients even when no actual testing was performed. In many other instances, the tests were intentionally diluted, compromising accuracy and reliability — but still billed to the federal program responsible for reimbursing uninsured testing costs.
Despite knowing the lab’s practices were unsafe and unethical, Alvi authorized the submission of thousands of claims for reimbursement from the HRSA, resulting in a payout of more than $14 million between 2020 and 2022.
Federal Investigation Exposes Scheme
The scheme was uncovered following an extensive probe led by the FBI and the Office of Inspector General for the U.S. Department of Health and Human Services (HHS-OIG). Prosecutors said Alvi pleaded guilty to one count of wire fraud last year and agreed to cooperate with authorities.
As part of his sentence, Alvi was ordered to pay full restitution totaling more than $14 million and forfeit luxury assets acquired during the fraud period.
“This sentencing should serve as a warning,” said U.S. Attorney Andrew S. Boutros. “Anyone who exploits a national health emergency for personal gain will be held fully accountable.”
Part of Broader Federal Crackdown
The case is part of the Health Care Fraud Strike Force Program, a federal initiative launched in 2007 to crack down on fraud across Medicare, Medicaid, and other federal health services. Since its creation, the program has brought charges against individuals involved in over $30 billion in fraudulent schemes nationwide.
Justice Department officials emphasized that pandemic-related fraud remains a top priority as agencies continue to audit and prosecute abuses of emergency funds.
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