Three heads of Phinaliz Communications LLC, operating in Oneonta, NY, have been nabbed in connection with a scheme that aimed to steal over $1 million from Medicaid through transportation service billing. The scheme focused on billing for services that never actually existed, ballooning costs, and paying out kickbacks to those receiving Medicaid and utilizing their transportation services. The arrests come after a lengthy investigation between the New York State Comptroller's Office, the Otsego County District Attorney, the Otsego County Sheriff's Office, the Oneonta Police Department and the U.S. Department of Health and Human Services - Office of Inspector General.

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The Crimes

New York State Comptroller Thomas P. DiBNapoli said:

"The defendants allegedly engaged in a systematic scam to defraud the Medicaid program of millions of dollars,” said New York State Comptroller Thomas P. DiNapoli. “Medicaid fraud impacts us all and diverts money from those truly in need. Thanks to the partnership between my office, Otsego County District Attorney Muehl, Otsego County Sheriff Devlin, Oneonta Chief of Police Witzenburg and the HHS-OIG, this fraud was uncovered and now these defendants will be held accountable.”

Philip Mtui, Mbaga Kaiza, and Tony Taylor, were arrested Thursday, August 24th in Oneonta. Mtui, 46, is listed at the company's owner, Kaiza, 47, is operations manager, and Taylor, 42, worked as a dispatcher, driver, and a manager.

The Investigation

The fraud was investigated by federal, state, and local entities over the course of years. The investigation included executing a search warrant at the company's headquarters as well as many hours of surveillance. The investigation is still ongoing, and more arrests may be on the way.

“The disruption of this criminal behavior and associated kickbacks for fraudulent charges has an impact beyond theft,” Oneonta Police Chief Christopher Witzenberg said. “The kickbacks were undoubtedly used to fuel substance abuse issues for vulnerable people, resulting in a host of other complications in our community."

The defendants involved in the case are presumed innocent until proven guilty in a court of law.

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