A Raleigh man admitted guilt in a federal case involving illegal kickbacks and false tax filings tied to a Los Angeles lab, a scheme that routed tens of millions of taxpayer dollars through bogus COVID-19 and respiratory virus testing claims. The federal filing lays out how a California lab submitted massive false claims to Medi-Cal and Medicare, while paying collectors for phony specimens and hiding income. The case resulted in felony pleas that carry years behind bars, large fines, restitution, and seized assets.

James Shuford Price, III, 59, of Raleigh pleaded guilty in federal court to paying illegal kickbacks for referrals to his California lab and to filing a false federal tax return. At sentencing, Price faces a statutory maximum of 13 years’ imprisonment, a $500,000 fine, and three years of supervised release, along with restitution obligations to Medi-Cal, Medicare, the IRS, and others.

Price owned and ran Golden Star Labs, a Los Angeles facility that billed heavily for multi-panel tests for SARS-CoV-2, Influenza A and B, and RSV. Between August 2023 and June 2025, court documents say GSL submitted more than $85 million in false claims to Medi-Cal and more than $11 million in false claims to Medicare, and that those phony claims prompted over $60 million in disbursements to the lab.

“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.” said U.S. Attorney Ellis Boyle.

Investigators say GSL used so-called collectors in California and other states to obtain test specimens from Medi-Cal and Medicare beneficiaries. Price allegedly instructed the lab to compensate those collectors based on the volume of samples provided, and between August 2023 and January 2025 GSL paid over $17 million to them.

The collectors supplied bulk quantities of bogus samples, often obtained through identity theft and other fraudulent means, and GSL systematically billed federal and state programs for testing those sham specimens. In the lab’s first six months of billing, about 96 percent of GSL’s Medi-Cal claims were tied to fraudulent authorizations from a single out-of-state physician whose identifiers were stolen and misused.

Price briefly halted testing in February 2024, ostensibly to “clean up” billing, but operations resumed in March and the misconduct continued. From late March 2024 until January 2025, roughly 92 percent of GSL’s Medi-Cal claims were based on phony authorizations that used the stolen personal information of five different clinicians.

“This guilty plea demonstrates the FBI’s unwavering commitment to protecting federal healthcare programs and the taxpayers who fund them. Orchestrating a $60 million Medicare fraud scheme is a profound violation of public trust. This guilty plea is the direct result of meticulous investigative work conducted alongside our law enforcement and government partners,” said Reid Davis, the FBI Special Agent in Charge in North Carolina.

Federal agents also found that GSL drafted written contracts with collectors that pretended to set fixed fees and forbid payments tied to referral volume. Those contracts were a sham, investigators say, because the lab kept paying collectors on a per-specimen basis to induce referrals and generate fraudulent claims that yielded millions in payouts.

“Today’s plea reflects our commitment to protecting patients, clinicians, and taxpayer-funded programs from those who try to profit through deception,” said Special Agent in Charge Donald “Trey” Eakins, Charlotte Field Office, IRS Criminal Investigation. “The defendant orchestrated an extensive fraud scheme generating thousands of illegitimate laboratory test claims to Medi Cal and Medicare resulting in multimillion-dollar reimbursements. This scheme not only violated federal healthcare programs but undermined trust in critical medical services.”

The Department of Health and Human Services Office of Inspector General highlighted the cross-jurisdiction work needed to pursue such schemes. “Effectively investigating complex fraud schemes like this one requires close coordination among federal and state agencies from coast to coast. This favorable outcome shows that HHS-OIG and its partners will aggressively pursue fraudsters who try to illegally boost profits using kickbacks, which compromise impartial medical decision-making and drive up health care costs for everyone,” said Robb R. Breeden, Special Agent in Charge, HHS‑OIG Pacific Region.

During the investigation, authorities seized more than six million dollars in assets linked to the fraud. Price also admitted to filing a false federal income tax return for 2022, failing to report income from several sources, including funds tied to victims of a prior investment scam.

“California is committed to protecting the integrity of our health care programs and ensuring taxpayer dollars are used appropriately,” said Department of Health Care Services Director Michelle Baass. “We appreciate our partnership with our colleagues at the U.S. Department of Justice in pursuing this case. Together, we are strengthening oversight, holding bad actors accountable, and safeguarding the Medi-Cal program so it can continue delivering vital services to the Californians who rely on it every day.”

Medi-Cal is a state-administered Medicaid program funded jointly by California and the U.S. government, and federal rules only allow payment for diagnostic testing when an authorized treatment provider orders medically necessary services. The Department of Justice recently announced the National Fraud Enforcement Division to focus on fraud against the American people, work that supports President Trump’s Task Force to Eliminate Fraud chaired by Vice President J.D. Vance.

Ellis Boyle, U.S. Attorney for the Eastern District of North Carolina, announced the case, which was investigated by the FBI (Charlotte Field Office, Raleigh Resident Agency) with IRS-CI (Charlotte Field Office), U.S. HHS-OIG (Pacific Regional Office), and the California Department of Health Care Services Investigations Division. The guilty pleas mark the latest result in a multi-agency effort to stop large-scale healthcare fraud and recover taxpayer dollars.