Former Teacher Pleads Guilty in $51 Million Medicare Fraud Scheme in National Fraud Enforcement Division Prosecution

SAN DIEGO - Former teacher Jeanett Valenzuela Ayub pleaded guilty in federal court today, admitting that she conspired with others to launder millions of dollars of health care fraud proceeds and paid $3.7 million in unlawful kickbacks.

On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division. The core mission of the Fraud Division is to zealously investigate and prosecute those who steal or fraudulently misuse taxpayer dollars. Department of Justice efforts to combat fraud support 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

According to her plea agreement, Valenzuela and co-conspirators owned and operated multiple durable medical equipment (DME) companies, which sold orthotics - including back, wrist, and knee braces - to Medicare beneficiaries.

Valenzuela admitted that in operating the DME companies, she and co-conspirators paid unlawful kickback payments to sham marketing companies who provided bogus prescriptions for DME. The prescriptions were signed by physicians who had no legitimate doctor-patient relationship with the beneficiary; had not conducted a legitimate medical evaluation of the beneficiary; and had not impartially determined that the beneficiary actually needed the DME.

When agents interviewed Medicare beneficiaries during its investigation, the Medicare beneficiaries confirmed that they never spoke with a doctor, were never examined by a doctor related to the prescribed DME, and were not familiar with the prescribing doctor; never used nor even opened the packages containing the DME; and many of the Medicare beneficiaries still had the DME in their original unopened packages.

Valenzuela further admitted that she used DME companies to submit fraudulent claims to Medicare. Once Valenzuela's or her co-conspirator's DME companies were suspended from billing Medicare, Valenzuela conspired to put DME companies in the names of nominee owners while she and her
co-conspirators maintained control of the companies and the monies received from Medicare. In total, Valenzuela and her co-conspirators billed Medicare nearly $51 million and were paid approximately $20 million, ultimately laundering at least $14 million dollars of Medicare proceeds.

Among Valenzuela's co-conspirators was her brother, Fernando Valenzuela Ayub, who previously pleaded guilty to the same offense and is pending sentencing. When her brother was arrested on
December 9, 2024, for his involvement in this conspiracy, Valenzuela absconded to Tijuana. Ultimately, Valenzuela was detained in August 2025 in the Dominican Republic after she left Mexico and traveled with family for a vacation.

After being detained in the Dominican Republic, Valenzuela was removed to the United States through Miami, Florida, where she was then arrested by U.S. Marshals and ultimately transported to San Diego to face the pending charges against her.

Valenzuela is scheduled to be sentenced on July 24, 2026, at 9:00 a.m.

The case is being prosecuted by Assistant U.S. Attorney Blanca Quintero of the Southern District of California. Former Assistant U.S. Attorney Valerie Chu contributed significantly to the case.

DEFENDANT Case Number 25cr2489-DMS

Jeanett Valenzuela Ayub Age: 51 Chula Vista, CA

SUMMARY OF CHARGES

Money Laundering Conspiracy - Title 18, U.S.C., Section 1956(h)

Maximum penalty: Twenty years in prison and $500,000 fine

INVESTIGATING AGENCIES

Federal Bureau of Investigation

U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG)