Former Optum employee found guilty of fraud via ‘ghost employee’ scheme

A Minnesota jury has found a former senior director at Optum guilty of defrauding the Eden Prairie-based health care company by hiring a friend for a fictitious job and then collecting kickback payments from the ghost employee.

The U.S. Attorney’s Office for Minnesota announced the verdict Feb. 18, saying a Minneapolis jury found Karan Gupta, 47, of California guilty of 10 counts of wire fraud and one count of money laundering conspiracy.

The government says frauds against Optum totaled more than $1.2 million.

Prosecutors alleged Gupta in 2015 recruited and approved the hiring of a lifelong friend to work at Optum in a job for which he was not qualified.

Gupta then became supervisor for his friend, who for almost four years did no work for Optum while collecting a salary that started at more than $100,000 annually, prosecutors say. The compensation increased with raises and bonuses each year.

At Gupta’s demand, his friend paid the defendant more than half of his unearned Optum salary in kickbacks, and they agreed on a plan to conceal the payments, according to a news release from the U.S. Attorney’s Office.

“Those who manufacture fraudulent schemes to appropriate money from legitimate businesses must be held accountable for their criminal conduct,” said Daniel Rosen, the U.S. Attorney for the District of Minnesota, in a statement. “Kickback schemes and no-show jobs undermine legitimate businesses, and the perpetrators must suffer the consequence of their actions.”

“We are carefully evaluating our legal options going forward,” Kelley said via email.

UnitedHealth Group did not immediately respond to requests for comment.

UnitedHealth runs the nation’s largest health insurer, UnitedHealthcare, and a health services business called Optum, which includes a large unit for data and analytics.

Minnesota hired Optum last year to review billing across more than a dozen federally funded social service programs as a key step to addressing widespread fraud.

In the former director’s court case that concluded this week, prosecutors say the fraud was discovered after Gupta was terminated in November 2019 for a separate fraud Optum discovered. The company investigated and referred the case to federal law enforcement.

According to prosecutors, Gupta’s friend was hired for a managerial data engineering position after Gupta provided a false résumé the friend used to secure the position.

The friend, who lived in New Jersey, met no one else at Optum, sent almost no emails and regularly did not log into his work computer for weeks on end, prosecutors say.

“Mr. Gupta abused his position of trust ... to defraud his company by hiring a ghost employee for a fictitious position, so that he could collect hundreds of thousands of dollars in kickbacks over many years,” said Rick Evanchec, the acting special agent in charge of the FBI’s field office in Minneapolis.