Mona Khan stood by as her husband, Iftakhar, was sentenced for healthcare fraud. Mona had been well paid by Michigan Rehabilitation and Pain Management (MRPM), her husband’s enterprise, despite the fact that she did nearly no work. Mona was listed on MRPM’s cost reports as its Executive Director, working 2,340 hours per year providing "overall supervision of fiscal and community relations."
Unfortunately, Mona signed Exhibit 6 to MRPM’s cost reports which included the false information regarding her position and salary with MRPM. Exhibit 6 also included an attestation that the salary information was "correct to the best of [her] knowledge and belief . . . [and] that anyone who misrepresents or falsifies this essential information may . . . be subject to fine or imprisonment."
Not surprisingly, the government contended that Exhibit 6 to the cost report was a false claim in its own right and a false statement made for the purpose of getting a false claim paid. The court agreed and held that Mona’s cost report certification violated the False Claims Act in both respects.
The court then went on to hold that even if the False Claims Act judgment were held to be unsustainable on appeal, Mona Kahn’s act of endorsing her paychecks when she knew she had not performed any services as an employee allowed the government to recover much of the money paid to her under theories of unjust enrichment and payment by mistake.
It is important to remember that the government may, in some cases, have the ability to recover funds from a third party who receives funds from a tainted transaction, especially if they have significant involvement in the transaction.