A Los Angeles–based company has settled with the city’s attorney for $26 million over allegations that it faked hundreds of COVID test results when it couldn’t turn them around as quickly as promised.
“The victims of this alleged scheme might unknowingly have spread COVID to others,” tweeted Los Angeles city attorney Mike Feuer on Thursday, with a link to a Los Angeles Times story on the matter.
Sameday Technologies and its chief executive officer, Felix Huttenbach, were accused by Feuer and Los Angeles County District Attorney George Gascón of providing fake COVID test results to more than 500 clients, informing them they were negative when their tests had not been run, the Times reported.
The office of the the Los Angeles attorney general, and the Los Angeles district attorney, did not immediately return Fortune’s request for comment.
In a statement to Fortune, Sameday Technologies said it was founded in September 2020 “in an effort to make fast, reliable COVID testing available to everyone” and that it “failed to meet the standards for excellence our customers deserve” early in the pandemic.
“We have corrected the problems that arose back in 2020 and have made significant investments in compliance and systems to ensure that we meet our customers’ expectations,” the statement read.
Negative results were allegedly forged at the direction of Huttenbach for clients who complained about the lack of results or threatened to report the company, the Times reported. The company had allegedly promised results in 24 hours for $195 but couldn’t make that deadline because the labs it contracted with couldn’t deliver and had said as much, Feuer and Gascón allege.
The U.S. Department of Justice announced Wednesday that 21 people had been charged over the past week and a half “as a part of a nationwide enforcement push to root out those who exploit the pandemic through health care fraud schemes,” according to the Associated Press. Collectively responsible for $150 million in fraud, the alleged crimes included fraudulent Medicare claims, misappropriating funds intended for frontline workers, and selling fake vaccination cards.
A similar Justice Department effort nearly a year ago involved 14 defendants and nearly $150 million in false billings as well, according to the AP.
Last month the Justice Department named Kevin Chambers as its chief prosecutor for pandemic fraud, a follow-through on President Joe Biden’s State of the Union promise to pursue criminals who stole billions in COVID-19 relief aid.
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