Three owners of Medicaid transportation companies have been charged with stealing more than $4.7 million from New York's Medicaid program through phony billing, according to investigators. The companies allegedly billed for rides that never happened, reported fake group rides as individual trips, and inflated mileage over nearly five years.
New York State Comptroller Thomas DiNapoli and State Police Superintendent Steven G. James announced the arrests of Ismat Farhan, Effat Rizwan and Fouzia Rizwan, as reported by WNYT. Investigators say Farhan ran USA Medical Transport Inc. out of a used car dealership alongside his brother, Effat Rizwan, who separately ran NYS Med Transport Inc. and EZ Medical Transportation Inc. from the same location. Fouzia Rizwan owned EZ Medical Transportation, per the same account. Ismat Farhan is from Slingerlands, while Effat Rizwan and Fouzia Rizwan are from Schenectady.
Investigators also reported that the defendants paid kickbacks to passengers, though the evidence does not establish whether that conduct has been proven in court. Medicaid transportation providers are allowed to bill for patient transportation to legitimate medical appointments, and approved providers may bill mileage once for an entire group — but the program requires prior authorization for group rides, a detail investigators say the defendants allegedly circumvented by disguising collective trips as individual ones.
How the Alleged Scheme Was Broken Down by Company
According to the joint investigation, USA Medical Transportation allegedly submitted more than $2.9 million in phony invoices for group trips and another $340,000 in invoices for trips that never happened at all. EZ Medical allegedly billed more than $1.1 million for fraudulent group trips plus $184,000 for rides that did not occur. NYS Medical Transport allegedly billed more than $79,000 for fraudulent group rides and more than $4,500 for trips that did not take place.
The forensic analysis of Medicaid claims underlying the charges covered January 1, 2020, through December 21, 2024. The case began after DiNapoli's Division of Investigations received a complaint in December 2024, which led the office to partner with the State Police Special Investigations Unit on the probe.
Ismat Farhan and Fouzia Rizwan were each charged with one count of first-degree grand larceny. Effat Rizwan faces one count of first-degree grand larceny and one count of second-degree grand larceny. Farhan and Effat Rizwan are due back in court December 7, while Fouzia Rizwan is scheduled to return December 9.
Officials Vow Continued Scrutiny of Medicaid Billing
DiNapoli said the three family members allegedly stole millions from the state Medicaid program, and added that his office aggressively investigates Medicaid fraud to safeguard the program, thanking Schenectady County District Attorney Robert Carney and Superintendent James for their partnership. James said the defendants allegedly exploited trusting passengers who were simply seeking safe rides to medical appointments, and said authorities would not tolerate people victimizing customers to steal taxpayer money.
This is not the first time Ismat Farhan's name has surfaced in a Medicaid billing dispute. The New York Attorney General's Office previously reached an $860,000 settlement with Farhan and USA Medical Transport, under which Farhan agreed to pay a total of $862,500 to the New York State Medicaid Program, according to The Daily Gazette. That earlier matter found more than 2,500 false claims and roughly $400,000 billed for unsupported transportation services, covering June 2015 through February 2020 — a separate period and separate allegations from the current $4.7 million case.
Medicaid transportation fraud cases have surfaced repeatedly across the state in recent months. In a separate case cited by WNYT, Muhammad Adnan Saeed pleaded guilty to Medicaid fraud in 2025 and was sentenced to three to nine years in jail, along with an order to pay $760,000 in restitution. The same report noted that Mohammad Chaudhry was indicted in 2026 on allegations of stealing more than $1.8 million from Medicaid.
Other recent cases underscore how often transportation billing has drawn scrutiny from state investigators. The Office of the New York State Comptroller announced in October 2025 that a Schenectady County medical transportation company owner was charged with stealing more than $1.8 million from Medicaid over nearly four years. More recently, the Comptroller's office reported a Saratoga County Medicaid transportation provider was arrested for allegedly stealing more than $700,000 over a four-year span, and a separate release announced four arrests tied to more than $1.6 million in alleged Medicaid fraud elsewhere in the state.
New York's Medicaid transportation policy manual requires providers to obtain prior authorization from the applicable official before certain rides are billed, though the available excerpt does not spell out every circumstance the rule covers. For now, the case against Farhan, Effat Rizwan and Fouzia Rizwan remains in its early stages, with all three scheduled to appear in court this December.
