The total for the 12-month period that ended June 30 far surpasses the previous record of $2. 5 million. But Kilgore and the director of his Medicaid Fraud Control Unit said the new record puts a mere dent in the widespread fraud that hampers the federal and state program for the poor and disabled.

"We had a banner year, but we know there's more to do out there," Kilgore said in a news conference at the Capitol.

Kilgore said aggressive investigations by federal and state authorities produced 18 convictions for Medicaid fraud during the last fiscal year. The penalties in those cases included $9. 5 million in fines, court-ordered restitution and asset forfeitures. The fraud unit collected another $2. 5 million from civil actions, Kilgore said.

Authorities closed significant cases in almost every region of the state, Kilgore said. In Roanoke, a federal investigation of nursing home operator HCMF Corp. led to the October 2001 conviction of its principal shareholder, William Cranwell, and its treasurer, Pendleton Smith, on misdemeanor fraud charges. The company also admitted committing felony health care fraud.

Investigators found that the company sought Medicaid reimbursements to cover salaries and benefits for employees who did little or no work for the nursing homes. Those employees included members of Cranwell's and Smith's families. The company was ordered to pay $1. 7 million in restitution to the Medicaid and Medicare programs and another $275,000 in fines.

A separate investigation by state and federal authorities led to convictions of a husband-and-wife doctor couple in Buchanan County who sought Medicaid reimbursements for prescriptions that were distributed illegally. Vinod Modi received a 37-month prison sentence in April and his wife, Kailas, was placed under house arrest for two months, The couple must make $2 million in restitution payments.

After the federal government collects its share of the payments recovered statewide, Virginia will get the remaining $8 million. The amount will go to the state's Medicaid budget.

Federal officials estimate that fraud consumes as much as 10 percent of the Medicaid budgets nationwide, said Randall Clouse, the director of the Medicaid Fraud Control Unit. Virginia has a Medicaid budget of $3 billion.

"One of the best ways to bring down the rising cost of health care is to be sure money from our taxpayer-funded programs goes to patients, not criminals," Kilgore said.