Medi-Cal Fraud Case: $270 Million in Claims and Luxury Purchases

L.A.'s top federal prosecutor Bill O'Salley showed us around this U.S. Marshals warehouse.

It should offend every American taxpayer that these people are taking advantage of the system and enriching themselves.

These items had been owned by Paul Randall, who pleaded guilty this year in one of the largest Medi-Cal fraud cases in California history.

He submitted above $270 million worth of claims to the state of California.

Authorities say that money paid for Kobe Bryant game-worn sneakers, baseball cards of Jackie Robinson and Mickey Mantle,

and this home, one of seven properties Randall owned.

Let me tell you what a piece of work this Randall guy was. He's got six prior convictions for fraudulent conduct.

Who's responsible for the breakdown of the system?

Obviously, there's a breakdown in the criminal justice system if this guy was able to have six convictions and never did any real prison time.

We turned up a private driveway.

He was living like a king off of us.

Climbing into an exclusive corner of Orange County.

It's eight bedrooms, ten bathrooms.

In other cases, prosecutors believe some of the money not spent on luxury goods is sent overseas.

It's much more difficult, if not impossible, for us to trace it or recover it.

Investigating government fraud is a priority for Heywood Talco. He's been warning officials about scams for two decades.

U.S. taxpayers lose a trillion dollars a year to these criminal groups.

Where's it going?

It goes to Russia. It goes to China. It goes to Nigeria. It goes to Romania.

By his estimate, of that trillion dollars, roughly 70% ends up in the hands of transnational criminal gangs.

Taxpayers are funding transnational criminals who are using this money for horrible things.

Cars. Cards. Compounds.

This is what fraud looks like after it's already happened.

Eseli and Talco agree.

That is why it is so important that the money never goes out in the first place.