A Walnut Creek, California man who orchestrated a years-long scheme to put a no-show employee on the payroll of Minnesota health services giant Optum was sentenced to 36 months in federal prison this week. Karan Gupta, 48, was sentenced on Monday in Minneapolis after a jury found him guilty in February of 10 counts of wire fraud and one count of money laundering conspiracy.
U.S. District Judge Kate M. Menendez handed down the sentence following a trial that lasted six days, according to the U.S. Department of Justice. Gupta worked as a senior director of data analytics at Optum, where he earned more than $260,000 a year at the height of his career, according to the Minnesota Star Tribune. Prosecutors say he used that position of trust to recruit a lifelong friend for a job that friend would never actually perform.
That friend, 45-year-old Shangraf Kaul of East Stroudsburg, Pennsylvania, was hired as a data engineering manager at Optum in late 2015. Federal trial evidence showed that over his nearly four years on the payroll, Kaul met no other Optum employees, sent almost no emails, and regularly went weeks without logging into his company computer, per the Justice Department. Kaul collected a six-figure starting salary that rose through annual bonuses and raises even as he performed no actual work for more than three years.
How the Kickback Payments Moved Across State Lines
To keep the scheme running, Gupta and Kaul agreed on a plan to conceal kickback payments equal to roughly 60% of Kaul's unearned salary, the Star Tribune reports. Kaul initially made cash deposits directly into Gupta's bank account from New Jersey, according to the Justice Department, and later mailed Gupta a debit card tied to a checking account that received Optum's direct deposits, allowing Gupta to withdraw cash from ATMs in California.
Optum first fired Gupta in November 2019, but not because of Kaul's fraudulent job. The company terminated him after uncovering his involvement in a separate, similar no-show employee scheme, and that discovery triggered the internal investigation that ultimately exposed Kaul's phantom position, the Justice Department says. The Star Tribune reports that Optum then referred the case to federal law enforcement.
Financial Toll Topped $1.2 Million Across Both Schemes
The Kaul ghost employee scheme alone accounted for over $950,000 in unearned pay and kickbacks, but federal prosecutors say Gupta's total fraudulent hiring schemes against Optum exceeded $1.2 million once the earlier scheme is factored in, according to Becker's Hospital Review. Assistant U.S. Attorney Matthew Forbes prosecuted the case following a white-collar crime investigation by the FBI's Minneapolis Field Office, per the Eden Prairie Patch.
U.S. Attorney Daniel Rosen said in a statement that Gupta's actions undermined a health care provider that millions of Americans depend on, adding that defrauding a private company is not a victimless crime, per the Star Tribune. FBI official Christopher Dotson said in a statement that the bureau is committed to investigating complex fraud schemes that exploit trust and defraud victims through deliberate deception, the Star Tribune reports.
What the Sentence Means Under Federal Guidelines
Wire fraud under 18 U.S.C. § 1343 carries a statutory maximum of up to 20 years in prison per count, but actual sentences are largely shaped by calculated loss amounts under advisory federal sentencing guidelines, according to Burnham & Gorokhov. Gupta faced 10 wire fraud counts, meaning his 36-month sentence falls far below the theoretical statutory ceiling but tracks with how loss-driven guideline calculations typically play out in white-collar cases. Per the Star Tribune, Gupta's attorney says he is exploring options for an appeal.
Kaul avoided trial by pleading guilty in February 2025 to one count of conspiracy to commit wire fraud and remains awaiting federal sentencing, according to the Justice Department. It remains unresolved what sentence Kaul will ultimately receive or whether the court will order formal restitution to Optum.
A Case Study in Corporate Oversight Gaps
Employment law analysts at Bassford Remele noted that the case highlights material weaknesses in corporate internal controls, warning that distributed remote tech roles are especially vulnerable to payroll fraud without routine system audits. Optum, headquartered in Eden Prairie, Minnesota, controls one of the nation's largest networks of health care providers and generated $270.6 billion in revenue in 2025 as the primary health services arm of Minnetonka-based UnitedHealth Group, which owns UnitedHealthcare and posted $447.6 billion in total annual revenue, according to Quantumrun. For a company of that scale, the case underscores how a single unmonitored hire slipped through for years before anyone noticed.
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