James Shuford Price III, a 59-year-old North Carolina man, pleaded guilty on Wednesday to defrauding Medicare and the California Medical Assistance Program (Medi-Cal) out of approximately $60 million through a kickback scheme. The fraudulent activities centered on bogus tests for COVID-19, flu, and other viruses.
Price, who owned Los Angeles-based Golden Star Labs, submitted claims for more than $11 million to Medicare and $85 million to Medi-Cal for SARS-CoV-2, Influenza A and B, and Respiratory Syncytial Virus (RSV) tests between August 2023 and June 2025. Medicare and Medi-Cal paid out over $60 million for these tests. The FBI and the U.S. Attorney’s Office in the Eastern District of North Carolina subsequently seized $6 million in assets related to the scheme.
The scheme involved Price paying kickbacks to "collectors" in California and other states, who were responsible for supplying test samples. These collectors were paid more than $17 million between August 2023 and January 2025. Prosecutors stated that these collectors engaged in widespread identity theft, including using stolen information from out-of-state physicians, to obtain the samples. For instance, approximately 90% of the claims submitted by Golden Star Labs to Medi-Cal were based on fake test requests using stolen personal information from five clinicians.
According to the Department of Justice, "fake contracts" were created to give the false appearance that Golden Star Labs was operating legally. However, the kickback scheme, where collectors were paid per specimen to induce referrals, continued despite these phony contracts, leading to millions of dollars in payouts from Medicare and Medi-Cal.
In addition to the fraud charges, Price also pleaded guilty to filing a false federal income tax return in 2022, related to income he received from the scheme. He faces a potential sentence of up to 13 years in prison, a $500,000 fine, and three years of supervised release. U.S. Attorney Ellis Boyle of the Eastern District of North Carolina stated, "Stealing taxpayer dollars that should be used to help legitimate beneficiaries is lowdown, dirty pool. We have a message to fraudsters who steal federal dollars: we will catch, prosecute, and imprison you. Cheaters. Never. Win."