Jaekwan Lee

Introduction

Jaekwan Lee, 42, of Flushing, New York, is a licensed physical therapist who admitted his role in a scheme to defraud Amtrak’s health care plan. He pleaded guilty on May 12, 2026, before U.S. District Judge Madeline Cox Arleo in Newark federal court to conspiracy to commit health care fraud. On October 8, 2026, Lee was sentenced to 15 months in prison, two years of supervised release, and ordered to pay $841,666 in restitution, U.S. Attorney Robert Frazer announced.

Background Information

The sentencing landed amid a government-wide push against fraud. On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (Fraud Division), which is investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.

The Controversy or Incident That Led to Their Cancellation

Convicted and sentenced. Lee pleaded guilty to conspiracy to commit health care fraud and was sentenced to 15 months in prison and $841,666 in restitution.

From January 2022 through June 2022, Lee and his co-conspirators agreed to engage in a scheme to bill the Amtrak health care plan for fraudulent claims for services that never were provided and were medically unnecessary. A licensed physical therapist, Lee “allowed his license and business bank accounts to be used in the fraudulent billing scheme, in return for a portion of the proceeds.” Other members of the conspiracy recruited Amtrak employees to participate in the scheme by paying them cash, in return for allowing the conspirators to use their personal and insurance information to submit false and fraudulent claims. The broader scheme involved dozens of Amtrak employees and multiple health care providers, who paid hundreds of thousands of dollars in cash kickbacks to Amtrak employees over the course of the scheme. In total, the Amtrak health care plan paid over $11 million in fraudulent claims associated with providers connected to the scheme.

Public Reaction and Consequences

U.S. Attorney Frazer credited special agents of the Amtrak Office of Inspector General, under the direction of Special Agent in Charge James Harper, and the Amtrak Police Department, under the direction of Chief of Police James Cook, with the investigation. The government is represented by Assistant U.S. Attorney Katherine M. Romano, Deputy Chief of the Bank Integrity, Money Laundering, and Recovery Unit in Newark. Per the release, “The Amtrak health care plan paid out $841,666 for claims associated with Lee.” The court ordered him to repay that amount in full.

Current Status

Lee’s case is fully resolved at the sentencing stage. Following his May 12, 2026, guilty plea before Judge Arleo, the court imposed sentence on October 8, 2026: 15 months of imprisonment, two years of supervised release, and the $841,666 restitution order. The investigation has resulted in the prosecution of nineteen individuals, including Lee, and all have pleaded guilty to conspiracy to commit health care fraud. He was represented by defense counsel Patrick J. McIlwain, Esq., and Megan Rha, Esq.

Impact on Their Career/Life

The conviction leaves the 42-year-old physical therapist with a federal felony record and a 15-month prison term to serve, to be followed by two years of supervised release. He remains obligated to pay $841,666 in restitution for the claims the Amtrak health care plan paid out in connection with him. Having let his professional license and business bank accounts serve a fraudulent billing scheme in exchange for a share of the proceeds, Lee now enters federal prison as a convicted health care fraud conspirator in a case that cost the plan more than $11 million overall.

Sources

• U.S. Attorney’s Office, District of New Jersey, “New York Physical Therapist Sentenced to 15 Months in Prison for Role in $11 Million Scheme to Defraud the Amtrak Health Care Plan” — source