Pervez Siddiqui, a Pakistani-American community board member in Brooklyn, New York, was arrested on Monday, 16 June 2025 alongside seven alleged co-conspirators in connection with a $38 million fraud targeting the federal Medicaid programme, according to reports. Federal prosecutors allege the group ran a false-billing scheme through two social adult daycare centres in Brooklyn over a period of nearly six years.

What the Alleged Scheme Involved

Prosecutors allege that Siddiqui and his co-accused exploited APNA Adult Daycare and Ashiana Social Adult Daycare — both in Brooklyn — to submit fraudulent Medicaid claims for services that were either never rendered or provided to individuals who did not qualify. According to reports, they recruited individuals to enrol in the programmes, billed Medicaid on their behalf, and then paid those individuals a cut of the collected funds in exchange for the use of their identities.

The alleged fraud ran from 2019 to December 2024. Medicaid, the government health insurance programme for low-income Americans, pays up to $6,000 per month per person for long-term care services for the elderly or infirm — making it a high-value target for the type of scheme prosecutors describe.

Key Details From the Charging Documents

The charging documents reportedly reveal that the operation used Pakistan-based billing staff and employed code words such as 'laddu' while laundering proceeds through shell companies. Fake sign-in sheets at the two centres reportedly showed attendance figures that exceeded the facilities' actual capacity. In some cases, individuals listed as programme participants were reportedly located in Pakistan at the time the services were billed.

Authorities raided locations linked to the alleged scam in December 2024, according to reports.

Who Are the Accused

Siddiqui, 78, is a member of a New York City community board and is associated with the American Pakistani Public Affairs Committee, an affiliation that reportedly gave him access to New York Mayor Zohran Mamdani and other city officials. He also reportedly owns approximately 15 pharmacies in New Jersey, though those businesses do not feature in the charging documents.

The seven named co-conspirators are Shazia Bibi (also known as Shazia Wattoo), Abdul Aziz, Shair Ali, Zebun Ahmed, Josna Begum, Saira Khatoon, and Atia Shahnaz. Shazia Bibi is also reportedly a community board member. In 2022, she testified before the City Council, stating: 'We as a Pakistani American Community and as a Muslim American feel alienated because we as a community could not get any resources.'

A Broader Pattern of Medicaid Fraud

This case is not an isolated incident. In a separate, unconnected matter, Zakia Khan and Ahsan Ijaz pleaded guilty in federal court to defrauding the government of $68 million through fraudulent billing in another Medicaid programme. The two owned Happy Family Social Adult Day Care and Family Social Adult Day Care, and admitted to scamming a programme designed to help senior citizens by paying relatives to provide home care — avoiding the higher cost of nursing homes.

Brooklyn Federal Prosecutor Breon Peace said at the time of that case: 'Social adult day care and home health services are meant to help seniors, but as alleged, the defendants allegedly turned their businesses into a brazen cash grab of millions of dollars from the Medicaid program.'

What Happens Next

The case against Siddiqui and his co-accused is now before federal prosecutors in Brooklyn. The scale of the alleged fraud — compounded by the use of overseas billing staff and shell companies — suggests investigators may continue to probe the network's full financial trail. The parallel conviction in the Khan-Ijaz case signals that federal authorities are intensifying scrutiny of Medicaid-linked adult daycare operations across New York.