Fourth Circuit Upholds 17-Year Sentence in $12M Medicaid Fraud Case
July 31, 2025 | JacobiJournal.com – In a decisive legal ruling, the U.S. Court of Appeals for the Fourth Circuit upheld the 17-year prison sentence of Donald Booker, a North Carolina lab owner convicted of running a large-scale Medicaid fraud case. The court affirmed both the conviction and sentence tied to a scheme involving over $12 million in false Medicaid billing. Booker operated United Youth Care Services and United Diagnostic Laboratories, where he orchestrated the submission of fraudulent drug testing claims. The conspiracy involved kickbacks to treatment centers and housing facilities, including “Do It 4 The Hood” and “Legacy Housing,” in exchange for patient referrals. Scheme Involved Routine Drug Tests and Kickbacks According to court documents, Booker billed Medicaid for unnecessary, repetitive drug screens, often performed twice weekly on patients without proper medical evaluation. These patients were referred by community organizations that received direct illegal payments in return. The case resulted in convictions for illegal remuneration, money laundering, and conspiracy to defraud the U.S. government. Over $1.6 million in illegal kickbacks were proven at trial. The court rejected all arguments for reversal, stating the evidence overwhelmingly supported the jury’s findings. Broader Relevance for Medicaid Providers This Medicaid fraud case is part of a growing trend of federal enforcement targeting diagnostic labs, addiction treatment providers, and telehealth schemes. The Fourth Circuit’s ruling reinforces the DOJ’s approach of pursuing not only fraud but also financial arrangements that jeopardize patient care and program integrity. Providers nationwide are urged to evaluate referral relationships and billing protocols. This ruling serves as a strong compliance reminder in the face of mounting scrutiny. For a full legal opinion, see the Fourth Circuit’s document in the U.S. Court of Appeals for the Fourth Circuit (PDF). FAQ: About the Medicaid Fraud Case Why did the Fourth Circuit uphold the 17-year sentence in this Medicaid fraud case? The court found no error in the jury’s verdict or sentencing process, citing substantial evidence of illegal kickbacks, false claims, and intent to defraud Medicaid. What industries should take note of this ruling? Diagnostic laboratories, behavioral health providers, and referral networks—especially those serving Medicaid populations—should examine the ruling’s implications for compliance enforcement. What does this case mean for future Medicaid fraud investigations? The ruling signals continued judicial support for aggressive prosecution of healthcare fraud, including complex schemes involving community partnerships and repeated billing abuse. Stay ahead of the latest enforcement trends. Subscribe to JacobiJournal.com for weekly fraud, labor, and healthcare compliance updates impacting professionals nationwide. 🔎 Read More from JacobiJournal.com:
CFPB Accused Rocket Homes Engaged in Illegal Kickback Scheme
December 28, 2024 | JacobiJournal.com — The Consumer Financial Protection Bureau (CFPB) has accused Rocket Homes, a subsidiary of Rocket Companies, and The Jason Mitchell Group of engaging in an illegal kickback scheme. According to the CFPB, this alleged practice steered mortgage applications toward Rocket affiliates, undermining fair competition and increasing costs for homebuyers. This case highlights the growing regulatory scrutiny over mortgage practices and real estate referrals in the U.S. Financial experts note that such enforcement actions aim to protect consumers by ensuring transparency, fair competition, and ethical conduct in the housing market. Homebuyers, brokers, and lenders alike are reminded to carefully review agreements and incentives to avoid practices that could violate federal regulations. Allegations Against Rocket Homes The CFPB claims that Rocket Homes, one of the largest mortgage lenders in the United States, incentivized real estate brokers and agents. Specifically, they offered referrals and inducements to funnel real estate settlement business to Rocket affiliates, including Amrock and Rocket Mortgage. Moreover, The Jason Mitchell Group reportedly encouraged these referrals by offering “dog bone” awards. They gave awards, such as $250 gift cards, to agents who made the most referrals to Rocket’s affiliates. CFPB Director Rohit Chopra criticized these actions, stating, “Rocket engaged in a kickback scheme that discouraged homebuyers from comparison shopping and getting the best deal. At a time when homeownership feels out of reach for so many, companies should not illegally block competition in ways that drive up the cost of housing.” Rocket Homes Responds CFPB Accused Rocket Homes: Rocket Homes firmly rejected the CFPB’s allegations, calling the lawsuit baseless. In a statement, the company said, “The facts are clear – data shows one-third of consumers with a loan application already in progress with Rocket Mortgage, before contacting Rocket Homes, chose to close with a different lender. This proves Rocket Homes is committed to empowering homebuyers to make the best decisions for their unique needs.” While Rocket Homes denies the allegations, legal experts emphasize that the case could set an important precedent for how referral incentives are regulated in the mortgage industry. Even if the company ultimately prevails, the lawsuit underscores the need for transparency in real estate and mortgage transactions, reminding homebuyers and agents to carefully evaluate any incentives or referral programs that might influence lending decisions. However, representatives for The Jason Mitchell Group did not immediately comment on the allegations. Broader Enforcement This lawsuit marks the third major action taken by the CFPB in recent days. For instance, it follows lawsuits against Walmart and major banks like JPMorgan Chase, Bank of America, and Wells Fargo over their alleged mishandling of fraud in peer-to-peer payment systems. These recent enforcement actions reflect the CFPB’s broader focus on protecting consumers across multiple sectors of finance. By targeting both large banks and nonbank companies like Rocket Homes, the bureau is signaling that all entities handling consumer funds or financial transactions are subject to strict oversight. Understanding these regulatory trends can help consumers recognize potential risks, make informed decisions, and hold companies accountable for ethical business practices. Read the official release here. FAQs: CFPB Accuses Rocket Homes What does CFPB accuse Rocket Homes of? The CFPB accuses Rocket Homes of engaging in an illegal kickback scheme that steered mortgage applications toward affiliated companies. How did the alleged kickback scheme worked? CFPB claims Rocket Homes incentivized real estate agents and brokers with awards and referrals to channel business to Rocket affiliates. How is Rocket Homes responding to the accusations? Rocket Homes rejected the allegations, stating that data shows many consumers still chose other lenders, demonstrating compliance with fair competition practices. What impact could these accusations against Rocket Homes have on homebuyers? CFPB warns that such kickback schemes could increase costs for homebuyers and limit comparison shopping, making transparency critical in mortgage choices. What services does Rocket Homes provide, and why is it involved in the CFPB case? Rocket Homes, a subsidiary of Rocket Companies, assists homebuyers by connecting them with mortgage lenders and providing real estate services. It is involved in the CFPB case because the bureau alleges that Rocket Homes engaged in an illegal kickback scheme, steering mortgage applications to affiliated companies and potentially undermining fair competition. How did the alleged kickback scheme work, and what incentives were offered to real estate agents? According to the CFPB, Rocket Homes incentivized real estate agents and brokers to refer business to Rocket affiliates, such as Amrock and Rocket Mortgage. The alleged incentives included awards like $250 gift cards, nicknamed “dog bone” awards, for agents who generated the most referrals, which could discourage comparison shopping and increase costs for homebuyers. Subscribe to JacobiJournal.com for ongoing coverage of consumer finance, real estate regulations, and fraud investigations. 🔎 Read More from JacobiJournal.com: