O.C. man pleads guilty to nearly $270M Medi-Cal fraud involving prescription drugs

LOS ANGELES – An Orange County man has pleaded guilty to submitting nearly $270 million in fraudulent claims over an 11-month span to Medi-Cal for expensive prescription drugs containing generic ingredients that were not medically necessary and, in many instances, not provided to the purported recipients, the Justice Department announced today.  

Paul Richard Randall, 66, of Orange, pleaded guilty Monday to one count of wire fraud committed while on release. He has been in federal custody since June 2025.

“This defendant used a public health program as his personal piggy bank,” said First Assistant U.S. Attorney Bill Essayli. “This guilty plea should send a message that this administration — consistent with the President’s war on fraud — will not turn a blind eye while criminals fleece taxpayers.”

“Thanks to the leadership of President Donald Trump, the Department, working closely with the Task Force to Eliminate Fraud, is supercharging efforts to take down every fraudster and bring them to justice,” said Acting Attorney General Todd Blanche. “In one day, the Department prosecuted the theft of a half-billion in taxpayer dollars. All those ripping off the American people are on notice.”

“The defendant was a repeat fraudster who caused Medi-Cal, a program designed to help those in need, to be billed nearly $270 million for expensive and medically unnecessary medications,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “He and his co-schemers stole over $178 million through false and fraudulent claims for these medications, lining their own pockets with public funds. The Criminal Division will aggressively prosecute those who defraud Medicaid and exploit taxpayer-funded benefit programs.”

“Schemes that bill Medicaid for costly drugs that patients never needed or received threaten the integrity of the program,” said Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “This plea shows our firm resolve, alongside our law enforcement partners, to exposing such fraud operations, ensuring those responsible are held accountable, and safeguarding taxpayer-funded health care programs.”

According to his plea agreement, Randall, along with Kyrollos Mekail, 37, of Moreno Valley, and Patricia Anderson, 58, of West Hills, took advantage of Medi-Cal’s suspension of its requirement that health care providers obtain prior authorization before providing certain health care services or medications as a condition of reimbursement. The suspension of the prior authorization requirements was part of an ongoing transition of Medi-Cal’s prescription drug program to a new payment system.

Through a business called Monte Vista Pharmacy, Randall and his co-schemers exploited Medi-Cal’s prior authorization suspension by billing Medi-Cal tens of millions of dollars per month for dispensing high-reimbursement, non-contracted, generic drugs through Monte Vista Pharmacy. Some prescription medications purportedly were to treat pain and included Folite tablets, a vitamin available over the counter.

Normally, these high-cost reimbursement medications would have required prior authorization under Medi-Cal’s old payment system. Medication involved in this scheme was medically unnecessary, frequently was not dispensed to patients, and procured by kickbacks.

From May 2022 to April 2023, Monte Vista billed Medi-Cal more than $269 million and was paid more than $178 million for 19 expensive, non-contracted drugs containing low-cost, generic ingredients that were not medically necessary, not provided, or both.

Randall and others then laundered their illicit proceeds by transferring the proceeds of the Medi-Cal fraud scheme to a third party to pay kickbacks to Anderson, to promote the fraud scheme and to conceal and disguise the transfers from detection by law enforcement.

Randall admitted in his plea agreement to transmitting by wire at least approximately $269,120,829 in false and fraudulent claims to Medi-Cal for purportedly dispensing the fraud scheme medications that Anderson prescribed, on which Medi-Cal paid at least approximately $178,746,556.

United States District Judge Mark C. Scarsi scheduled an August 3 sentencing hearing, at which time Randall will face a statutory maximum sentence of 30 years in federal prison.

Relatedly, Mekail pleaded guilty in August 2024 to two counts of health care fraud and awaits sentencing. Anderson is charged with two counts of health care fraud.

The United States Department of Health and Human Services Office of Inspector General (HHS-OIG), the FBI, and the California Department of Justice are investigating this matter.

Assistant United States Attorney Roger A. Hsieh of the Major Frauds Section and Trial Attorney Siobhan M. Namazi of the U.S. Department of Justice, Criminal Division, Fraud Section are prosecuting this case. Assistant United States Attorney James E. Dochterman of the Asset Forfeiture and Recovery Section is handling asset forfeiture matters in this case.

Medi-Cal fraud in California in the Past Four Years

As of April 2026, Medi-Cal fraud in California is estimated to involve billions of dollars annually, though exact totals for the past four years vary significantly between official state reports and external federal or political assessments. 

Key Fraud Metrics (2021–2025)

• Recovered Funds: Between fiscal years 2021 and 2023, the California Medi-Cal Fraud Control Unit (MFCU) recovered approximately $544 million.
• Case Outcomes: During that same three-year period (2021–2023), state investigations led to 180 indictments and 221 convictions.
• Questionable Payments: A 2025 state audit highlighted that eligibility discrepancies identified since 2021 potentially caused the state to disburse $1.9 billion in questionable payments. 

Recent Major Investigations & Allegations

• Hospice Fraud Takedown (2026): State officials recently announced “Operation Skip Trace,” targeting a hospice fraud ring that allegedly defrauded Medi-Cal of more than $267 million. Another federal operation, “Operation Never Say Die,” unsealed charges involving nearly $60 million in losses from sham hospices in Southern California.
• Federal Funding Disputes: In early 2026, federal officials and members of Congress demanded California repay $1.3 billion in federal Medicaid funds, alleging they were improperly spent on non-emergency care for undocumented immigrants in violation of federal rules.
• L.A. County Estimates: Federal administrators recently estimated that roughly $3.5 billion in fraud has occurred within the hospice and home health care industry in Los Angeles County alone. 

Summary of Reported Impacts (2021–2025)

While state leadership notes that California led the nation in criminal recoveries for fiscal year 2024, federal auditors and critics argue that lax oversight and eligibility checks continue to leave billions of taxpayer dollars vulnerable to organized crime rings.