Brooklyn Adult Daycare Owner Sentenced to 76 Months in Prison for $64 Million Medicaid Fraud and Kickback Scheme

A Brooklyn woman who owned two social adult daycare centers and a home health care company has been sentenced to 76 months in federal prison for leading a vast $64 million Medicaid fraud and illegal kickback scheme. Zakia Khan, 55, was also ordered to pay over $56 million in restitution and to forfeit $5 million in fraud proceeds, including two properties, cash, and gold jewelry seized during a search of her home.

According to court documents, Khan owned Happy Family Social Adult Day Care Center Inc., Family Social Adult Day Care Center Inc., and a home health care fiscal intermediary called Responsible Care Staffing Inc. From approximately October 2017 through July 2024, Khan and her co-conspirators paid kickbacks and bribes to marketers who referred Medicaid recipients to her daycare centers.

They also paid kickbacks directly to Medicaid recipients to induce them to sign up for services that were never actually provided. Between 2017 and 2024, Khan’s companies fraudulently billed Medicaid approximately $64 million, of which Medicaid paid approximately $56 million.

Khan used multiple business entities to launder the fraud proceeds and generate the cash used to pay the illegal kickbacks. She pleaded guilty in August 2025 to conspiracy to commit health care fraud and conspiracy to defraud the United States and pay health care kickbacks.

This case reflects the government’s aggressive pursuit of healthcare fraud, particularly schemes that exploit programs designed to support seniors and vulnerable populations. The investigation was conducted by HHS-OIG, Homeland Security Investigations New York, and the NYPD. Whistleblowers who report similar Medicaid fraud or illegal kickback schemes can pursue remedies under the False Claims Act, which allows private individuals to file qui tam lawsuits on behalf of the government and share in any recovery.

Individuals with knowledge of healthcare fraud are encouraged to consult experienced whistleblower attorneys to understand their options and protections.