California man pleads guilty to defrauding Medi-Cal program of $178M

As concerns about rampant fraud continue to grow across the country, particularly in California, authorities have announced the indictment of a man charged with a scheme to defraud taxpayers of hundreds of millions of dollars.

Paul Richard Randall, 66, of Orange, California, pleaded guilty to one count of fraud after local authorities said he billed Medi-Cal, California’s version of Medicaid, more than $269 million and was paid more than $178 million for “19 expensive, non-contracted drugs that contained low-cost, generic, over-the-counter ingredients, both of which were needed.”

Randall and his colleagues took advantage of a temporary rule change in Medi-Cal that removed the need for prior authorization for certain drugs. Using a pharmacy they controlled, they billed Medi-Cal a large amount each month for expensive generic drugs that would have required prescriptions.

Randall and his co-conspirators then obtained the illegal proceeds by transferring the money to a third party, using it to pay Anderson, run the scheme, and conceal the transactions from law enforcement.

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“This defendant used the public health system as his bank,” First US Attorney Bill Essayli said in a statement. Press release.

“This plea should send a message that this state — in line with the President’s war on fraud — will not stand idly by while criminals defraud taxpayers.”

A press release says Randall will be sentenced in August and faces a maximum sentence of 30 years in federal prison.

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Acting Attorney General Todd Blanche speaks during a news conference at the Robert F. Kennedy Department of Justice building in Washington, DC, on April 7, 2026. He discussed the department’s anti-fraud efforts and announced the creation of the National Fraud Enforcement Division. (Chip Somodevilla/Getty Images)

California has been in the middle of fraud problems in recent weeks and has been called by an anti-fraud team led by Vice President JD Vance, who recently revealed a dramatic increase in California’s health care providers suspended as part of the labor effort.

Last week, a state sweep in southern California called “Operation Never Say Die” led to eight local arrests and unsealed charges against 15 people allegedly tied to a $60 million Medicare billing fraud scheme, Fox 11 Los Angeles reported.

News of the guilty plea spread quickly on social media with conservatives charging that more work needs to be done to combat fraud in California.

“California is arguably the Fraud Capital of the United States,” Rep. Kevin Kiley, an independent congressman from California, posted on X. “Finally we see accountability.”

“Can you apply for $300 million in less than a year and get that money?” Conservative commentator Mike Cernovich posted on X.

“This is Gavin Newsom’s reign of fraud,” reporter Christopher Rufo posted on X.

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“Well done and thank you for protecting taxpayers and those in need,” said Haywood Talcove, CEO of LexisNexis Special Services & LexisNexis Risk Solutions Government. posted on X.

“We need to focus on the end of payment systems – how was $250M stolen in the first place? The systems are primitive, have no prior identity verification, rely on self-reported information and do not perform third-party audits or use Spectrum.”

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Gavin Newsom speaks on stage during the “Networth And Chill With Guest Governor Gavin Newsom” at the 2026 SXSW Conference And Festival at the Hilton Austin on March 15, 2026 in Austin, Texas. (Gary Miller/FilmMagic)

“Put him in chains and lock him up,” Rep. Tim Burchett, R-Tenn., wrote in X.

California Gov. Gavin Newsom’s office pointed Fox News Digital to a post on X in which they retracted the DOJ’s press release saying “there’s a little truth missing.”

“These alleged frauds were first discovered by federal officials and then turned into criminal charges,” Newsom’s office wrote. “We appreciate the state’s long-standing partnership in working with agencies to fight fraud – and end this disinformation effort by the current Administration. People can see how California has taken action: StopFraud.CA.Gov.”

Newsom’s office has generally responded to critics in recent weeks by saying the state “leads the nation in fraud prevention.”

“Since @CAGovernor Gavin Newsom took office: – $125 billion+ in fraud STOPPED – 1,200+ criminals ARRESTED – 83% reduction in EBT fraud in one year – New hospice licenses CLOSED starting in 2022,” Newsom’s press office wrote on X earlier this month.