Two men who call themselves “The Housing Guys” are facing decades in prison after pleading guilty to stealing millions from a Medicaid housing program.
The U.S. Department of Justice says Anthony Waddell Jefferson, 37, and Lester Brown, 53, both of Philadelphia, pleaded guilty to wire fraud after defrauding Minnesota’s Housing Stabilization Services (HSS) program of approximately $3.5 million.
According to court documents, the pair set up businesses in Minneapolis and enrolled as providers under the HHS program, which is designed to help people with disabilities, including seniors and individuals with mental illnesses and substance use disorders, find and maintain housing.
Instead of providing those services, prosecutors say Jefferson and Brown repeatedly traveled from Philadelphia to Minneapolis to recruit Medicaid beneficiaries at homeless shelters and Section 8 housing facilities. They enrolled roughly 230 individuals in the program and billed for services that were never delivered.
When insurance companies requested documentation to support their claims, the defendants fabricated emails about supposed clients and used ChatGPT to generate fake client notes, according to the DOJ.
The fraudulent billing ran from February 2022 through June 2025, resulting in approximately $3.5 million in improper payments from the Medicaid-funded program.
Officials say the case marks the first charges in Minnesota involving the use of artificial intelligence to further a fraud scheme targeting healthcare programs.
Says Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division,
“These defendants had no connection to Minnesota or its communities. They traveled across the country for one purpose: to prey upon and steal millions in taxpayer dollars meant for people struggling with homelessness, addiction and disabilities. Although programs like HSS are run by the states, they are funded with federal tax dollars. The Criminal Division will not stand by while fraudsters put all Americans’ tax dollars at risk.”
Jefferson and Brown each pleaded guilty to one count of wire fraud, a charge that carries a maximum penalty of 20 years in prison. The Housing Guys are slated for sentencing at a later date.
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