Fadel Alshalabi, 57, of Waxhaw, North Carolina, and Samuel Harris, 30, of American Fork, Utah, have been found guilty of conspiring to violate and directly violating the Anti-Kickback Statute. The U.S. Attorney’s Office for the Middle District of Tennessee announced the conviction today. Alshalabi, the owner and CEO of Crestar Labs, LLC, was also convicted of money laundering.
According to court evidence, Alshalabi and Harris orchestrated a scheme involving fraudulent contracts and illegal kickbacks to secure genetic testing orders. Harris, through Flojo Recruiting—operating as Secure Health—partnered with Crestar Labs to recruit patients covered by federal healthcare programs, including older and low-income individuals.
The patients were approached by non-medical marketers at senior health fairs, low-income housing, and even through door-to-door outreach. Using buccal swabs, they collected DNA samples for genetic testing, which were then sent to Crestar Labs. Telemedicine doctors, who were paid through illegal kickbacks, authorized these tests without properly assessing or even meeting the patients.
The evidence presented in court showed that Alshalabi paid marketers for each test sample and lab order, leading to over $100 million in fraudulent claims submitted to Medicare and Medicaid. The Department of Justice emphasized that these actions severely compromised the integrity of federal health care programs.
Each defendant faces a maximum of 10 years in prison for Anti-Kickback Statute violations and conspiracy charges. Alshalabi also faces up to 10 years in prison for money laundering.
“These guilty verdicts demonstrate that the FBI and our law enforcement partners will aggressively fight back to protect the integrity of our federal health care programs,” stated Joe Carrico, Special Agent in Charge of the FBI Nashville Field Office.
