ST. PAUL - United States Attorney Daniel N. Rosen announced that a federal jury in St. Paul convicted a Minnesota woman yesterday for executing a scheme to steal $3.6 million from the now-defunct Minnesota Medicaid Housing Stabilization Services (HSS) Program. The federal jury trial was before U.S. District Judge Susan Richard Nelson.

"The Fraud Division has arrived in Minnesota - and we are here to stay," said Assistant Attorney General Colin M. McDonald of the Justice Department's National Fraud Enforcement Division. "The jury's guilty verdict in this case sends a clear message that those who steal from programs meant to help our most vulnerable will be held accountable. As proven at trial, Meadows falsified records to enrich herself while preventing critical services from reaching those in need. Her fraud scheme - and others like it - forced Minnesota's Housing Stabilization Services Program to shut down entirely after costs of the program outran estimates by four thousand percent. I commend the dedicated prosecutors, agents, and support staff who worked tirelessly to deliver justice in this case."

"The defendant chose to defraud millions from a program meant to help vulnerable Minnesotans," said United States Attorney Daniel N. Rosen for the District of Minnesota. "My office is committed to prosecuting those who steal from the American taxpayer."

According to court documents and evidence presented at trial, Sharmaine Meadows, 45, of Lake Elmo, Minnesota, orchestrated a scheme to bill the HSS Program for housing services that were meant to transition the unhoused and assist them in sustaining that housing. Instead, these services were not actually provided. The HSS Program permitted providers to bill up to 150 hours for transitional services and 150 hours for sustaining services per eligible Medicaid beneficiary. Meadows routinely emphasized to her employees that they were required to maximize the billings to that 150-hour cap, even if the hours of services were never provided.

Agenda from Meadows' Company All Hands Meeting in July 2022 at which "Maximizing of Hours"

The evidence presented at trial also proved that Meadows and her company billed the HHS Program for in-person hours supposedly provided by employees who were in other states, like Illinois, and in other countries, like the Philippines, where the defendant paid only $6.00 per hour and explicitly offered no benefits.

Employment Offer Letter from Meadows' Company to Individual in the Philippines

She also submitted claims for services that could not have been provided because beneficiaries were in the hospital. And through data analysis, evidence showed that Meadows billed as if her employees were working more than 20 hours per day, every day, for weeks.

Summary of billing for "Impossible Days" by Meadows' company

Summary of billing for "Impossible Days" by Meadows' company

At the same time, Medicaid beneficiaries testified that they received little to no services from Meadows' company. These beneficiaries testified that they were routinely told by Meadows' employees that despite having received no assistance, they had run out of available hours in the HSS Program.

As a result of the fraud scheme, the HSS Program paid Meadows' company over $3.6 million between 2020 and 2025 into accounts that Meadows exclusively controlled.

The jury convicted Meadows of three counts of health care fraud. She is scheduled to be sentenced at a later date and faces a maximum penalty of 10 years in prison on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Colin M. McDonald of the Justice Department's Fraud Division; United States Attorney Daniel N. Rosen for the District of Minnesota; Special Agent in Charge Christopher D. Dotson of the FBI Minneapolis Field Office; Special Agent in Charge Thomas Ethridge of the Department of Health and Human Services, Office of Inspector General (HHS-OIG); and Special Agent in Charge Adam Jobes of the IRS Criminal Investigation (IRS-CI), Chicago Field Office, made the announcement

This case was the result of an investigation by the FBI, HHS-OIG, and IRS-CI.

Trial Attorneys Brant Cook and Emily Reeder-Ricchetti of the Fraud Division's Health Care Fraud Section, with the assistance of Health Care Fraud Section Trial Attorney Jody King and Assistant U.S. Attorney Matthew Murphy for the District of Minnesota, are prosecuting the case.

On April 7, the Department of Justice announced the creation of the Fraud Division. The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department's work to combat fraud supports President Trump's Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.

The Department of Justice's Health Care Fraud Strike Force Program, currently comprised of nine strike forces operating in federal districts across the country, has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers more than $45 billion since 2007. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the Office of the Inspector General for the Department of Health and Human Services, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at www.justice.gov/criminal-fraud/health-care-fraud-unit.