A Whitehall man who was one of three managers of a group of transportation companies charged with federal crimes for a kickback scheme involving transportation of the indigent to medical appointments has pleaded guilty to two federal felonies and agreed to cooperate against the owners of three cab companies, court records show.
Anthony C. Armstrong, 29, pleaded guilty in U.S. District Court to counts of conspiracy to commit health care fraud and conspiracy to defraud the United States, agreeing that he conspired with cab company owners from Ticonderoga accused of heading the multimillion-dollar scheme.
Authorities say Ticonderoga was the epicenter of a wide-ranging investigation into fraud in the federally funded program that pays for rides to medical appointments, many of them for drug rehabilitation services, for those who can’t pay themselves.
Authorities allege the program was defrauded of millions of dollars in numerous ways by at least 10 transportation companies, with false trips claimed, mileage overestimated and kickbacks of money and cigarettes given to passengers to switch companies.
13 people were arrested during a series of raids in May that involved local, state and federal investigators, mainly in Essex County. The raids followed months of wiretaps and interviews of cooperating witnesses. Armstrong is the first to plead guilty, according to court records and court officials.
Armstrong admitted he conspired with cab company owners Qaiser “Kaz” Gondal, 46, Khalid M. Chadder, 48, and Arshad Nazir, all of Ticonderoga.
Gondal operated Ti Taxi, Chadder ran Adirondack Taxi & Limo and Nazir operated Avalanche Taxi. They have pleaded not guilty.
In addition to the federal charges, seven others who were considered lesser players in the schemes were charged with felonies in Ticonderoga Town Court, where a court clerk said Wednesday they remain pending and adjourned until October.
Federal prosecutors have estimated the companies took in nearly $10 million in Medicaid funds over the years, millions of dollars of it fraudulently received.
Federal criminal complaints allege Adirondack Taxi & Limo alone took in $3.14 million from Medicaid reimbursement between 2015 and 2017.
Armstrong agreed in a written plea agreement filed in U.S. District Court that the scheme in which he was involved with Gondal defrauded the Medicaid program of at least $550,000. No financial estimate for the extent of his fraud with the other two companies was given.
He agreed that he provided or offered to provide “kickbacks” to those who used the service that amounted to at least $95,000 to entice them to switch cab companies.
The plea agreement includes snippets of wiretapped conversations Armstrong had with Gondal and others, including Armstrong boasting he told one passenger “anything they can do, I can do better” when enticing her to switch cab companies for her six-day-a-week rides to a drug rehabilitation center in Plattsburgh. He also admitted he allowed Gondal to falsely bill Medicaid for cab rides that his company did not give, claiming Armstrong was the driver.
Court records show Armstrong worked for the companies between 2013 and 2017, rising from a driver to a mid-level manager who coordinated rides.
Armstrong had moved to Whitehall and was starting a cab company in the Whitehall area at the time of the arrests, officials said.
The charges are punishable by up to 15 years in federal prison, although the plea agreement calls for federal prosecutors to recommend “downward departures” in sentencing guidelines for Armstrong’s cooperation.
Armstrong’s lawyer, federal assistant public defender Michael McGeown-Walker, did not return a phone call for comment Wednesday or Thursday.
Gondal’s lawyer, Marc Zuckerman, said he was reviewing a “voluminous” amount of documents in his client’s case, and it was unclear whether it was headed to trial.