HOUSTON, TX – October 7, 2026 (STL.News) Houston – Fraud Scheme – A Houston physician has been arrested and indicted on federal charges alleging he participated in a scheme that billed approximately $30 million to a federal COVID-19 reimbursement program for medical office visits prosecutors say were never provided.
Dr. Joseph A. Montes, 66, was taken into federal custody after a grand jury returned a 12-count indictment Sept. 30, according to the U.S. Attorney’s Office for the Southern District of Texas. The indictment was subsequently unsealed.
Montes made his initial appearance Oct. 6 before U.S. Magistrate Judge Christina Bryan in Houston.
Federal prosecutors allege that between 2020 and 2022, Montes and others submitted false and fraudulent claims to the U.S. Department of Health and Human Services’ Health Resources and Services Administration, or HRSA.
Approximately $30 million was allegedly billed to the program, and HRSA paid approximately $20 million, according to the Justice Department.
The allegations center on pop-up COVID-19 testing sites operated under Montes’ name and claims submitted for evaluation and management office visits that prosecutors contend never occurred.
Houston Doctor – Houston physician owned two medical clinics
According to federal court documents cited by the Justice Department, Montes owned and operated two Houston medical practices: Joseph A. Montes MD & Associates, P.A., and Montes Medical PLLC.
Prosecutors allege Montes permitted co-conspirators to operate pop-up COVID-19 testing sites under his name.
Patients went to the testing locations for nasal-swab COVID-19 tests, federal authorities say. Prosecutors allege the co-conspirators then submitted claims to HRSA for office visits that had not actually been provided.
The alleged difference between the services patients received and the services billed to the federal government is central to the criminal case.
Rather than alleging merely that testing services were improperly coded, prosecutors contend the federal program was billed for office visits that did not happen.
A Houston Doctor – More than 9,000 claims allegedly filed in one day
Federal prosecutors highlighted what they characterized as an extraordinary volume of claims associated with Montes’ clinics.
According to the indictment, on approximately 29 separate dates the clinics submitted more than 3,000 claims for evaluation and management services.
The most striking example allegedly occurred Dec. 1, 2021.
On that date, Montes’ clinics allegedly submitted more than 9,000 claims in a single day.
Federal prosecutors calculated that volume as approximately one purported patient visit every nine seconds over a continuous 24-hour period.
The government cited the volume as part of its allegation that the claimed medical services could not have been performed as represented.
The Justice Department described the claims as “impossible” in announcing the indictment.
A Houston Doctor – About $30 million allegedly billed
The amounts involved in the case require an important distinction.
According to the Justice Department, Montes and others allegedly billed HRSA approximately $30 million between 2020 and 2022.
HRSA allegedly paid approximately $20 million of those claims.
Therefore, the $30 million figure represents the approximate amount allegedly billed to the federal program, while $20 million represents approximately how much the government paid.
That distinction also clarifies early reporting surrounding Montes’ arrest.
Some initial reports characterized the case as involving more than $20 million in Medicare fraud. However, the Justice Department’s detailed announcement identifies the allegedly defrauded program as one administered by HRSA within the Department of Health and Human Services.
The federal government’s case, as described by prosecutors, concerns claims submitted to HRSA for purported medical office visits.
Prosecutors allege proceeds funded expensive purchases
The federal indictment also alleges what happened to proceeds from the scheme.
According to the Justice Department, Montes allegedly used proceeds to make expensive purchases at a luxury automobile dealership and Tiffany & Co.
Those allegations form part of the government’s broader financial case against Montes and are relevant to the money laundering charges contained in the indictment.
The purchases remain allegations and have not been proven in court.
Montes faces conspiracy, wire fraud charges
The federal grand jury returned a 12-count indictment against Montes on Sept. 30.
According to the U.S. Attorney’s Office, Montes faces charges involving conspiracy, wire fraud and money laundering.
If convicted, he faces a statutory maximum of five years in federal prison on the conspiracy charge.
Each wire fraud count carries a potential maximum sentence of 20 years in federal prison, while each money laundering count carries a potential maximum of 10 years.
Prosecutors said Montes also faces a possible maximum fine of $250,000.
Those penalties represent statutory maximums. They are not predictions of the sentence Montes would receive if convicted.
A federal court would determine any eventual sentence after considering the offenses, applicable federal law, sentencing guidelines, and other relevant factors.
Three agencies investigated the case
The FBI’s Houston office, the Department of Health and Human Services Office of Inspector General, and the Texas Attorney General’s Office Medicaid Fraud Control Unit conducted the investigation, according to the U.S. Attorney’s Office.
Assistant U.S. Attorney Kathryn Olson is prosecuting the case.
HHS-OIG separately listed the Montes prosecution among its federal enforcement actions on Oct. 6, identifying it as a COVID-19 criminal enforcement matter.
The involvement of multiple agencies reflects the different aspects of the allegations, which involve federal health care reimbursement, alleged fraudulent billing and financial transactions involving proceeds prosecutors contend came from the scheme.
Case focuses on pandemic-era reimbursement
The alleged conduct dates to the COVID-19 pandemic, when the federal government created and expanded programs intended to help health care providers respond to an unprecedented public health emergency.
HRSA, an agency within HHS, administered federal reimbursement programs designed to help providers cover qualifying COVID-19 testing, treatment, and related services.
The Montes prosecution centers on prosecutors’ allegation that the reimbursement system was used to obtain government payments for medical services that were never provided.
According to the indictment, patients were visiting pop-up locations for COVID-19 nasal-swab testing.
Federal authorities allege claims were nevertheless submitted for office visits.
The volume of those purported visits became a significant component of the government’s allegations.
On approximately 29 dates, prosecutors say more than 3,000 evaluation and management claims were submitted.
The Dec. 1, 2021, total was even greater, with more than 9,000 claims allegedly submitted during a single day.
That volume would correspond to about one purported patient encounter every nine seconds if spread evenly across a 24-hour period.
Federal COVID fraud investigations continue
The case illustrates the federal government’s continuing pursuit of suspected fraud connected with pandemic-era spending and health care programs years after the height of the COVID-19 emergency.
Billions of dollars moved through federal programs during the pandemic as agencies attempted to rapidly reimburse health care providers, support businesses and workers, and respond to the public health crisis.
Investigators have subsequently examined suspected abuse involving multiple pandemic programs.
In Montes’ case, prosecutors are focusing specifically on medical reimbursement claims submitted to HRSA.
The indictment alleges a multi-year scheme involving pop-up testing locations, patient information, purported medical office visits, and financial transactions tied to the alleged fraud.
If the case proceeds to trial, the federal government will have to prove those allegations through the judicial process.
Indictment is an accusation, not a conviction
Montes has been charged, but he has not been convicted of the crimes alleged in the indictment.
A federal indictment represents formal accusations approved by a grand jury. It does not establish that the allegations are true or constitute evidence of guilt.
The Justice Department specifically emphasized that principle when announcing the case.
Montes is presumed innocent unless and until the government proves his guilt beyond a reasonable doubt through due process of law.
The Southern District of Texas is prosecuting the case.
For federal investigators, the indictment represents the culmination of an investigation into approximately $30 million in allegedly fraudulent claims.
For Montes, however, the criminal proceedings are only beginning.
The government must now prove that the alleged fraudulent billing, conspiracy, and financial transactions occurred and that Montes possessed the criminal intent required for the offenses charged.
Until that happens, the allegations against him remain allegations.
Presumption of innocence: Dr. Joseph A. Montes has been indicted on federal criminal charges. An indictment is a formal accusation, not evidence of guilt. Montes is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
