Insurance Brokerage Executive Admits Role in $133M ACA Fraud Scheme Targeting Federal Subsidies

In a major health care fraud case, Dafud Iza, a 54-year-old executive vice president of a Florida insurance brokerage, pleaded guilty to his role in a $133 million scheme involving the Affordable Care Act (ACA). According to federal prosecutors, Iza and his accomplices submitted fraudulent applications to enroll ineligible individuals in ACA health plans to generate commissions from insurance companies administering the plans. These plans were subsidized by the federal government, and the fraud led to over $133 million in improper payments.

The scheme hinged on misrepresenting income levels to qualify ineligible consumers for federal subsidies. The participants deliberately targeted vulnerable populations, including individuals experiencing homelessness, unemployment, and substance abuse disorders. So-called "street marketers" were used to lure these individuals with bribes and to coach them through the application process using fabricated or mismatched personal information.

Iza faces up to 10 years in federal prison after pleading guilty to one count of major fraud against the United States. His sentencing will be determined based on U.S. Sentencing Guidelines and additional statutory considerations. The FBI, HHS-OIG, and IRS Criminal Investigation are leading the probe, while the DOJ’s Fraud Section continues to target large-scale health care fraud through its dedicated Strike Force Program.

This case underscores the vulnerabilities in government-subsidized insurance programs and the ongoing need for vigilance and oversight in health care enrollment processes to prevent fraud that exploits the nation’s most at-risk individuals.