COVID lab testing company reportedly was paid up to $124 million for COVID-19 testing

What do an axe-throwing lounge, a donut shop, and a COVID-19 testing company have in common? All three were under the ownership of the same husband and wife. Apparently, though, COVID-19 medical laboratory testing was more lucrative. It’s been reported this married couple’s testing company received as much as $124 million just from federal health programs.

The co-owners are now being sued by multiple state’s attorney generals for allegedly failing to deliver SARS-CoV-2 test results and/or for delivering COVID-19 test results that “were falsified or inaccurate,” according to NBC News.

Chicago-based Center for COVID Control (CCC)—an operator of 300 pop-up COVID testing sites nationwide—faces investigations from state and federal authorities amid allegations of improper procedures and business practices. The company voluntarily suspended operations in January, when the allegations first surfaced, according to a company press release.

The founders, who had no prior clinical laboratory experience, now say they have turned their attention from running the sites to handling the investigations, USA Today reported. The newspaper was the first to publicly report problems with the company and its associated lab, Doctors Clinical Laboratory (DCL), both of which have the same address in suburban Chicago.

According to USA Today, “The Center for COVID Control was incorporated in December 2020, according to Illinois state filings. The business, which describes itself as a ‘test collection marketing and management firm,’ worked closely with Doctors Clinical Lab. Regulators didn’t visit the lab for an on-site inspection until the end of September of the following year, according to the Centers for Medicare and Medicaid Services. Regulators found the lab was not reporting coronavirus test results to public health officials.”

Questionable Collection Procedures for COVID-19 Testing

An earlier USA Today story by reporter Grace Hauck described an outdoor COVID-19 collection site in Chicago run by a man operating from a small shack powered by a generator.

“As he opens the door, piles of plastic bags, apparently grouped by test type, can be seen in crates on the ground,” Hauck reported. “He encourages test-takers to scan a QR code with their phones, fill out an online form with identifying information, and write a digitally-generated string of numbers on a paper sheet inside the plastic test kit bag.”

Hauck’s story noted complaints from readers about shoddy specimen collection procedures, conflicting or errant clinical laboratory test results, and failure to receive COVID-19 results in a timely manner.

Block Club Chicago, a non-profit news site, reported on Jan. 13 that inspectors from the Centers for Medicare and Medicaid Services (CMS) had uncovered numerous instances of “non-compliance” and “deficiencies” at DCL.

CMS lab inspectors found that DCL “could not process or store PCR test samples appropriately—while it was being inundated with tests,” the news site reported. “Over an 11-day period in November, the lab received 84,436 PCR test samples; over that period, it processed and reported 43,240 test results, according to the [CMS] report.”

Specific problems included:

  • Inadequate staffing, training, and quality controls at the clinical laboratory.
  • A lack of freezers needed to store test samples.
  • Failure to maintain confidentiality of patient information.
  • Failure to label samples with identifying information.
  • Failure to log complaints from test recipients.

USA Today reported that the FBI executed a search warrant at the companies’ suburban Chicago offices on Jan. 22.

State Actions against Doctors Clinical Laboratory and CCC

In addition to the federal actions, state attorneys general in Minnesota and Washington State both filed lawsuits against Center for COVID Control (CCC) and Doctors Clinical Laboratory (DCL).

Minnesota Attorney General Keith Ellison

“When Minnesotans and people from around the country tested with these companies to keep themselves and their families safe, they trusted they would get correct [COVID-19 test] results on time,” said Minnesota Attorney General Keith Ellison in a statement announcing a lawsuit against the two companies. “I’m holding these companies accountable that sent back false or inaccurate [COVID-19 test] results, when they sent them back at all, for deceiving Minnesotans and undermining the public’s trust in testing.” (Photo copyright: Office of Minnesota Attorney General.)

Washington Attorney General Bob Ferguson filed suit in King County Superior Court on Jan. 31. “Center for COVID Control contributed to the spread of COVID-19 when it provided false negative results,” he stated in a news release. “These sham testing centers threatened the health and safety of our communities.”

On Feb. 17, Ferguson announced that the court had granted a preliminary injunction that prohibited CCC from providing testing services in the state.

NBC News reported that authorities in other states have also taken actions against the company. Oregon and Illinois launched civil investigations, while “Massachusetts and Rhode Island have issued cease and desist letters to the company, and local regulators in Washington and California shut down several of its sites for operating without a license,” the newspaper reported.

Big Money in COVID-19 Testing

USA Today reported that CCC was launched in December 2020 by Akbar Syed, 35, and Aleya Siyaj, 29, a married couple. Siyaj is listed as being CEO of CCC since June 2021, according to her LinkedIn profile.

“Doctors Clinical Lab is registered under another person’s name in state records, but federal documents and multiple former employees and business partners claimed Siyaj and Syed run the lab and Center for COVID Control,” Block Club Chicago reported.

USA Today reported that DCL received more than $124 million in federal reimbursement for COVID-19 clinical laboratory testing and treatment. The paper also described a lavish lifestyle for Syed and Siyaj, including recent purchases of a $1.36 million mansion and multiple luxury cars. Asked on social media site TikTok about the source of his wealth, Syed stated, “COVID money,” according to USA Today.

Siyaj and Syed have denied wrongdoing, stating that they are now focused on “responding and cooperating with legal probes, and to clearing our good names,” according to a statement provided to USA Today.

Regulatory Loopholes

One question about CCC and DCL is how they were able to escape regulatory scrutiny. “Some experts said unscrupulous lab operators can take advantage of a regulatory opening that allows labs to register, test, and bill before inspectors finish a CLIA certificate survey,” USA Today reported. “In other cases, investors might purchase or establish management agreements with labs and begin testing before inspectors get in to verify the lab’s reliability.”

Pathologists and clinical laboratory managers will want to continue to watch the news, as other examples of fraud and incompetence by new companies that rushed into the COVID-19 lab testing marketplace are uncovered and investigated by both state and federal regulators.

Further, some of these companies may have generated more than $1 billion in payments from public and private sources after launching testing operations in the months after the arrival of the pandemic.

Stephen Beale

Related Information:

COVID-19 Testing Chain Opened Pop-Ups Across the US. Now, It’s Temporarily Closing Amid Federal Investigation and Mounting Complaints

FBI Serves Search Warrant at Rolling Meadows COVID Testing Company and Lab

COVID Testing Company with 300 Pop-Up Sites across U.S. Faces Multiple Probes

Federal Inspectors Allege COVID Testing Firm Didn’t Put Patients’ Names on Specimens

Pop-Up COVID-19 Test Sites and Labs Capitalize on Lax Regulations, Prey on Vulnerable Americans

Tests in Trash Bags, Lying to Patients: Washington State AG Sues ‘Sham’ Center for COVID Control

Center for COVID Control Shuts Down Headquarters Amid FBI Investigation but Says Testing Sites May Branch Off

FBI Searches Center for COVID Control Headquarters Amid Probes into Multimillion-Dollar Testing Business

Center for COVID Control Under Investigation after USA TODAY Reporter Starts Asking Questions

How a Wedding Photographer and a Donut Shop Owner Got Millions in a COVID Testing Operation Now Under Investigation

Federal Authorities Investigate Lab, Misconduct Claims Tied to Center for COVID Control

Center for COVID Control’s Testing Sites to ‘Pause’ as Authorities in Two States Shut Down Centers

What’s the Center for COVID Control? Questionable Sites Spotlight Nation’s Thirst for Quick Testing

Center for COVID Control Faked Test Results, Minnesota Attorney General Says in New Lawsuit

State of Minnesota Fourth Judicial District Complaint

Attorney General Ellison Files Lawsuit against COVID-19 Testing Sites, Lab for Deceiving Consumers

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