Inside the secret federal fraud unit you’ve never heard of, who take down billion-dollar crime syndicates

LARGO, MD — Everyday objects cluttered a cramped room, filling every surface and corner with what looks like discarded junk.
It’s not a scene from the TV show “Hoarders.” Each piece in this little workshop is bugged—sometimes with cameras so small they’d fit through a pinhole.
Above one heap, a wall-mounted television displays a grid of live feeds from a dozen surveillance cameras across the nation — one fixed on a house in California, another an apartment complex in Ohio, a third showing a storefront in Manhattan.
“A lot of what we’re doing is proving a negative,” one federal agent said as he worked on placing a tiny camera into an object. He points to a feed of a stately home on a cul-de-sac. “This doctor in California is billing for seeing patients right now. That’s his car in the driveway. He’s actually at home.”
The Knock, as they call it, short for National Training Operations Center (NTOC), is the high-tech crimefighting headquarters for a branch of law enforcement many people don’t know exists—the Department of Health and Human Services Office of Inspector General (HHS-OIG).
HHS-OIG is the primary investigative agency behind many splashy fraud takedowns in recent months, including a $10 billion urinary catheter scheme linked to the Russian mob and an alleged $38M adult day care scam busted in Brooklyn, which ensnared Pakistani community leaders who cozied up to top Democrats.
Investigators admit it’s an unsexy job—chipping away at the nation’s explosive healthcare fraud epidemic—but someone’s got to do it, even if they never seem to get much credit.
Luckily, The Post got an exclusive tour of The Knock, an elite facility tucked away in a leafy, suburban medical plaza outside Washington, DC.
Behind blacked-out plate windows and an unmarked storefront, a small army of data analysts, digital forensics investigators and good ol’ fashion shoe leather cops work to claw back billions of dollars stolen from taxpayers each year.
“No one is better at fighting fraud than HHS-OIG,” Assistant Inspector General for Investigations Scott Lampert told me.
“Many of our agents have a passion for medicine or medical fraud. We have agents that are nurse practitioners, physician assistants, attorneys, people that have joined medical professions and want to take that love for their work and apply it differently.”
But with an estimated $100 billion taken by fraudsters each year, HHS-OIG can seem severely understaffed. Lampert said each of his investigators returns on average $45,000 a day in stolen taxpayer funds.
“That’s $15 million-a-year per investigator. If I had 100 more agents, think about what I could do. If HHS-OIG was on the stock market, I would invest in us. We have a tried-and-true solid return on investment with our partners. But with more resources, we can do more,” he said.
In one cavernous white room with a thick padded floor, fraud cops fitted me with a virtual reality headset, transporting me into their world for training.
Inside was a mind-bendingly realistic doctor’s office, where armed suspects opened fire. In the next scenario, I barged into a physician’s home, interrupting his virtual dinner. The digitized MD seized a baseball bat off the credenza and advanced toward me.
The technology is designed to prepare agents for high-stakes confrontations with scammers, but they also do it the old fashioned way, too.
One room of The Knock is built just like a doctor’s office, down to the reception desk, table lamps and filing cabinets — except everything is made of foam, and there’s a threat assessment target hiding behind a doorway.
“Tell me that doesn’t look like Paul Rudd,” said Thomas Floersch, special agent in charge and my guide, of the paper cut-out bad guy. “We all call him Paul Rudd.”
“When we do a takedown, I wear my body armor. I’m a big guy. I’m trying to get through somebody’s dining room without breaking the Ming vase. This stuff gives us an opportunity to train in a safe way.”
In another gymnasium-size tactical training room, fake knives litter the floor and life-size dummies are flopped about like war fatalities under a ceiling of pulsing red and blue lights to mimic police cars. The song “Bodies” by Drowning Pool blasts on a sound system.
“The lights and sound add additional stress. We do a lot of scenario-based training. We can get a little physical in here,” said Floersch.
“A few years ago when all the executive orders came down for de-escalation, it didn’t matter to us because we’ve been training that way for so many years. We train our people to have a clear head.”
From there, the tour moved to the digital forensics lab, where rows of specialists work methodically to extract data from seized computers and phones.
Bad guys are likely to smash up their tech when the cops crash through the door, so The Knock has its own clean room with rows of microscopes, clean room “bunny” suits, and a dust-sucking ceiling vac to aid in meticulously restoring damaged gizmos.
Most devices nowadays can be wiped remotely so the clean room also has a state-of-the-art Faraday box: a large metal enclosure with a transparent top and two gloved arm holes—think Homer handling the glowing uranium rod in “The Simpsons” title sequence—that blocks electromagnetic and radio frequency fields like Wi-Fi, Bluetooth and cellular.
Devices are powered off upon confiscation and only turned on in the Faraday box, where the contents can be safely downloaded before they catch a potentially corrupting cell signal.
Gone are the days where truckloads of paper documents get hauled out of doctors offices—once the iconic photo op of a fraud raid. Today cops show up with a single black Pelican case, where the bad guys’ phones and computers get tossed before ending up at the Knock lab.
Of the agency’s 1,450 employees over 100 are dedicated to data analytics—trawling through trillions of dollars in billing records looking for anomalies. 400 agents are program auditors, who were key in sniffing out $600 million in improper payments across six states in fraud-riddled autism services from 2017-2024.
HHS-OIG also has 50 field offices—known as Medicaid fraud control units—nationwide, where they work in partnership with local cops, the FBI, Department of Justice, and state Medicaid authorities.
Fraudsters run the gamut from sophisticated to shameless, said Lampert, like the 2018 case in New York when a man named Ballal Hossain signed up a dozen family members to work as caregivers for his mom. The crew was paid $348,000 from Medicaid over six years to look after the elderly woman at a Manhattan apartment, all the while she was actually living in Bangladesh.
Hossain got his brother to pose as their sick mother whenever inspectors showed up, before finally being caught and later sentenced for grand larceny, according to prosecutors.
OIG is exempt from the Health Insurance Portability and Accountability Act, better known as HIPPA, said Lampert, meaning agents can peep into the medical records of anyone in the country. That comes in handy when a Medicaid recipient, for one example he gave, gets taxpayers to buy him two prosthetic legs and a fake arm—with no corresponding record of surgery.
“We knock on their door, they open the door and they have two legs. Pretty easy to prove that claim is false,” said Lampert. “That’s some of the best evidence to take into court. ‘Ladies and gentlemen of the jury, his arm!’ Criminals try and get creative, but they’re not all smart.”
On Tuesday, agents announced another take down at a press conference in Pennsylvania. Federal authorities smashed a $5.7 million Medicaid racket, indicting 19 suspects in a wildly brazen home care scam.
Prosecutors revealed alleged fake home care workers routinely billed for dead, jailed, or jet-setting “patients.” One suspect logged an impossible 126 hours of work in a single day, while an Instagram-loving fraudster posted poolside drinks in Miami while purportedly working in Philadelphia. Other home care aides claimed billable hours for gym trips, cruises or even while running street drugs.
One jailed cocaine dealer bragged on prison calls that the homecare graft was “the best kept secret” and one accused fraudster, who owned a fake home care business, told cops upon his arrest, “everyone is doing this, if you arrest me you’ll have to arrest the whole city!”
HHS-OIG acknowledge things are so widespread they have become endemic in certain cities, and the recipients of the cash are often bought off.
“Kickbacks drive these schemes. It’s the fuel to the fire. If beneficiaries weren’t being paid to sometimes fraudulently enroll in [Medicaid programs] these schemes couldn’t survive or they’d be more difficult to perpetuate,” said Lampert.
Still, there’s little appetite to prosecute the patients, even if that might send a message.
“We don’t often arrest beneficiaries. These type of schemes, we really want to cut the head of the snake,” added Lampert.