$12.89 Million Meant for Phoenix Children's Hospital Was Diverted to a Private Account, Arizona Prosecutors Allege

October 20, 2026

PHOENIX

Phoenix Children's Hospital was supposed to receive the money. Arizona prosecutors allege that $12.89 million in state Medicaid payments meant for the hospital was instead diverted to a private bank account controlled by one man, in a case that, according to the complaint, turned on a fax, a letter purporting to be from a bank, and a single phone call.

The allegations are laid out in a direct complaint filed in Maricopa County Superior Court, reported by Focal News Phoenix on October 20, 2026, with information from the Arizona Attorney General's Office. The complaint accuses Juan Carlos da Cunha Tcachman, 56, of fraudulent schemes and artifices and theft of control of property, both Class 2 felonies, prosecutors allege. Tcachman had not been arrested as of October 20, according to the Attorney General's Office, which said it could not comment further because the case and the investigation are ongoing.

That status matters, and it is worth stating plainly at the start: these are allegations in a criminal complaint. They have not been proven in court, Tcachman is presumed innocent unless and until prosecutors prove the charges, and no finding has been made against him. What follows is what prosecutors allege happened, as described in the complaint.

A fax, a letter, and a phone call

According to the complaint, the alleged scheme began in July 2026. AHCCCS — the Arizona Health Care Cost Containment System, which is Arizona's Medicaid program — received a fax with a letter purporting to be from Wells Fargo, prosecutors allege. The letter claimed that Phoenix Children's Hospital had changed its bank account, effective July 1, according to the complaint.

After that fax arrived, a staff member spoke by phone with someone identified as “Michelle,” and AHCCCS then approved a change to the electronic transfer information for the hospital's payments, prosecutors allege. The complaint does not, in the reporting available Tuesday morning, describe a second, independent confirmation with the hospital itself before the change took effect — and that gap is the center of this story.

Payment-routing changes are routine in health care. Hospitals change banks, accounts are consolidated, and Medicaid programs pay large providers on a regular cycle. That routine is exactly what makes the control around a change so important. A routing instruction determines where public money goes next, in full, on the next payment run. If the verification step is a faxed letter and a phone conversation with a person whose identity is taken at face value, prosecutors are alleging, the system can be moved by paperwork alone.

Three payments, about $4.29 million each

Once the electronic transfer information had been changed, three payments of about $4.29 million each were sent to the new account, prosecutors allege. The total, according to the complaint, was $12,891,725.10. Some of that money has since been recovered, the complaint says, though the reporting Tuesday morning did not specify how much was recovered or how much remains missing.

Investigators say the account that received the payments was held and signed for by Tcachman, according to the complaint. Prosecutors allege he opened the account using a District of Columbia passport. Court records described in the complaint recount multiple large withdrawals from the account in August and September, after the payments arrived in July.

Investigators also reviewed surveillance images of cash withdrawals at a Wells Fargo branch in Miami and said they believe the person shown in those images is Tcachman, based on a comparison with his passport photo, according to the complaint. That identification, like every other element of the case, is an allegation investigators will have to support in court.

What prosecutors say Tcachman told an undercover contact

On October 3, during an undercover contact, prosecutors say Tcachman confirmed his identity and said he handled all activity in the account himself, according to the complaint. He reportedly said he had expected payments from clients, but did not know they would come from a government agency, and that the large deposits related to an investor he had met online, per the complaint.

Read carefully, that account — as prosecutors themselves describe it — is part of why this case will need to be tried on documents, records, and testimony rather than on headlines. The complaint alleges control of the account and large withdrawals. It also records a statement in which, prosecutors say, the account holder described expecting client payments and an online investor. Whether that explanation is true, incomplete, or a cover story is precisely what a court process exists to determine.

A separate case involving the Mayo Clinic

Prosecutors described a second, separate case with a similar alleged method. In that case, prosecutors accuse Joao Luiz Malago, 66, of using forged bank letters and impersonated executive communications to divert $458,407.08 in AHCCCS payments that were intended for the Mayo Clinic, according to the Attorney General's Office as reported by Focal News Phoenix.

The Attorney General's Office said Malago was apprehended in Florida and is expected to be returned to Arizona. Prosecutors are seeking warrants in both cases, according to the reporting. The allegations against Malago, like those against Tcachman, remain accusations that have not been proven in court.

Taken together, the two complaints allege the same underlying vulnerability used at two very different scales — $458,407.08 in one case, $12,891,725.10 in the other. In both, prosecutors allege, the money did not move because a computer system was breached. It moved, they allege, because someone persuaded the payment system, through letters and impersonated communications, to send it somewhere else.

Why this matters beyond one hospital

Phoenix Children's Hospital is not an abstract payee. It is the hospital Phoenix families turn to when a child is seriously ill, and Medicaid payments are a core part of how care for low-income children is funded in Arizona. Money diverted from that stream — even money later recovered, as the complaint says some of this was — is money that was not where it was supposed to be, when it was supposed to be there.

The case also lands in a state capital already on alert about deceptive communications aimed at public officials. Previously has covered suspicious letters sent to Arizona lawmakers that drew in the FBI, and, closer to the neighborhood level in the Valley, developments at Desert Ridge in northeast Phoenix. The subjects are different, but the common thread is verification: in Phoenix right now, a letter is not proof of anything until someone checks who actually sent it.

That is the closing lesson of the complaint, whatever a court ultimately finds about the two men charged. Public money moves on trust in paperwork — a letterhead, a fax, a familiar voice on the phone saying a bank account has changed. The safeguard cannot be politeness or routine. It has to be a callback to a number already on file, a confirmation with the hospital through a channel the requester does not control, and a pause before eight figures change direction. Prosecutors allege that, in July, those steps did not stop a change that sent $12.89 million the wrong way. A jury, if the case gets that far, will decide who is responsible. The system that approved the change should not wait for a verdict to ask how it happened.