Arizona AG creates $6M fund to support tribes impacted by sober living home fraud scandal

PHOENIX – The Arizona Attorney General’s Office has created a $6 million grant program to support tribal nations impacted by the state’s sober living home fraud scandal.

Tribes can apply for grants of up to $500,000 to alleviate economic loss and support recovery for members who were victimized by the fraudulent activity.

Applications must be submitted by Jan. 31, 2025.

“Every community deserves care they can trust,” Attorney General Kris Mayes said in a press release Tuesday. “This funding will help tribal nations provide much-needed support for individuals impacted by the fraudulent sober living home scandal. And my office will continue to pursue accountability for those responsible for sober living home fraud.”

The grant program is funded through the state’s anti-racketeering revolving fund, which is administered by the attorney general.

How was sober living home fraud committed?

Hundreds of Native Americans have been targeted by Phoenix-area scammers in multiple sober living home fraud cases. The billing schemes often left clients of fake clinics homeless and in some cases financed lavish lifestyles for the fraudulent providers, authorities have said.

The first person convicted in connection with the fraudulent schemes was sentenced to 3½ years in prison in May of this year.

Ariell Olivia Dix, 37, had pleaded guilty to illegal control of an enterprise. Prosecutors said she helped establish fake behavioral health treatment centers that fraudulently billed AHCCCS, the state’s Medicaid system, for tens of millions of dollars from January 2019 to September 2021.

The fake clinics were created to defraud the American Indian Health Program within AHCCCS.

The Associated Press contributed to this report.

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