Fourteen Charged In Upstate Workers' Compensation Sweep
Attorney General Spitzer, Inspector General Dineen Riviezzo, Insurance Superintendent Howard Mills, Insurance Fund Executive Director David P. Whener, and Workers' Compensation Board Fraud Inspector General John H. Burgher, Jr., today announced the arrests and arraignments of 14 individuals for insurance fraud and related charges following a joint investigation into workers' compensation fraud. The cases were brought in Albany, Broome, Dutchess, Erie and Herkimer counties.
The defendants were all charged with submitting fraudulent claims to obtain workers' compensation benefits. Typical misrepresentations involved failing to disclose present or past work status or the cause of injury. One defendant, Harold Higgins, allegedly collected over $100,000 while concealing his employment in the elective post of Assessor for the Town of Copake in Columbia County. The total benefits paid to all 14 defendants by insurance carriers, including the New York State Insurance Fund (NYSIF), exceeded $250,000.
"Every worker deserves the right to be compensated for medical expenses and lost wages that result from injuries sustained while working," Spitzer said. "However, workers who misrepresent their employment status in order to collect workers' compensation benefits, no matter how large or small the amount, ultimately increase the costs of doing business in New York."
Inspector General Dineen Riviezzo said: "Those who commit workers' compensation fraud are stealing benefits intended for truly deserving workers. It's an even worse affront when, as in the case investigated by my office, the alleged perpetrator of the fraud is an employee of state government."
Superintendent Howard Mills said: "Workers' compensation fraud costs honest, hard-working New Yorkers a staggering amount of money every year. The arrests of these individuals, however, offer compelling evidence that governmental agencies are effectively combating fraud.
Governor Pataki joins me in congratulating all those involved in these investigations and arrests. Working together, we are ensuring that more perpetrators of fraud are being convicted every year, and monies obtained fraudulently are being recovered on behalf of honest New Yorkers and businesses."
State Insurance Fund Executive Director David P. Wehner said: "I am proud of the work of our DCI investigators. With each arrest and successful prosecution the message to those who would defraud the workers' compensation system becomes louder and clearer, if you cheat, we will come after you."
Workers' Compensation Board Fraud Inspector General Burgher said: "When Governor Pataki created the Office of Workers' Compensation Fraud Inspector General and elevated workers' compensation fraud to a felony, he sent a strong message that lying or misrepresenting facts to obtain benefits is not acceptable and those who conduct such actions will be identified, arrested and prosecuted. Since its inception the Workers' Compensation Fraud Inspector General has conducted investigations resulting in hundreds of arrests, returning millions of dollars to victims. These 14 arrests are further proof that we will continue to work with our partners in state, local and federal government to ensure that those who break the law will be held accountable."
This sweep began in the fall of 2005, when Dale Fajen, of Schaghticoke, was charged with falsifying his company's application for workers' compensation insurance. Fajen, who owned two construction companies, lied about the type of work his employees were engaged in so that he could pay lower premiums. On October 17, 2005, he pleaded guilty to Insurance Fraud in the Second Degree, a class "C" felony, before the Hon. Jerry J. Scarano in Saratoga County Court. On December 12, 2005, he was sentenced to six months in jail, plus probation. He was required to pay back $135,046 in premiums owed to the NYSIF.
The 14 defendants whose arrests were announced today were charged with: Fraudulent Practices, a class E felony in violation of the Workers' Compensation Law; Falsifying Business Records in the First Degree, a class E felony; and Insurance Fraud in the Fifth Degree, a class "A" misdemeanor. Eleven defendants who filed false documents with the NYSIF were also charged with Offering a False Instrument for Filing in the First Degree, a class "E" felony. One defendant was also charged with violating state tax law.
The prosecutions are being handled by Assistant Attorneys General Lawrence Elmen, Richard Ernst, Russell Ippolito, Cydney Kelly, Paul McCarthy and Nancy Snyder under the direction of Deputy Chief Viola I. Abbitt of the Attorney General's Criminal Prosecutions Bureau. The cases were investigated by investigators from the New York State Insurance Department, the New York State Insurance Fund, the New York State Office of the Inspector General, and the Office of the Workers' Compensation Board Fraud Inspector General. The Attorney General's Investigation Bureau, under the direction of James D. Horton, also participated in the investigations.
A list of the defendants follows. The charges described below are merely accusations and the defendants are presumed innocent until and unless proven guilty.
Harold Higgins, 56, Craryville, NY
Higgins purportedly sustained workplace injuries on two separate occasions in November 1993 and October 1996 for which he filed notices of injury with his employer, the New York State Thruway Authority. In January 2000, he began working as the Assessor for the Town of Copake in Columbia County, and continued to do so through 2005. In documents filed with the NYSIF in 2000, 2001, 2003 and 2004, he falsely claimed to be unemployed . The defendant fraudulently received benefits in excess of $100,000. The case is pending in Colonie Town Court in Albany County.
Linda A. Autenrieth, 46, Queens, NY
Autenrieth suffered an injury while working as a nurse's aide for Northern Dutchess Hospital in October 1998, and began collecting workers' compensation benefits from One Beacon Insurance. Subsequently, Autenrieth began providing private nursing services, a fact that she concealed from the insurance carrier, thus collecting over $40,000 in benefits. The case is pending in Town of Pine Plains Town Court in Dutchess County.
Donald W. Murphy, 70, Tivoli, NY
Murphy suffered a work-related injury in August 1992. In November of 2003, he submitted a form to his insurance carrier falsely stating that he had not returned to work. He fraudulently collected benefits that exceeded $37,000. He also failed to file personal income tax returns for three years. The case is pending in Town of LaGrange Town Court in Dutchess County.
David J. Bajer, 48, Cheektowaga, NY
Bajer submitted a claim for a knee injury allegedly suffered at work in January 2005 while he was employed by the New York State Office of General Services. He failed to disclose on the Injury and Treatment form that he had sprained his knee while skiing the day before. He received benefits amounting to $27,000. The case is pending in Buffalo City Court in Erie County.
Daniel Banyai, 32, Hyde Park, NY
Banyai was injured in 1997 while working for Robin Apple Distributors, and began collecting benefits from the NYSIF. In documents submitted to the NYSIF, he failed to disclose the full extent of this employment. He fraudulently received benefits exceeding $17,000. The case is pending in Colonie Town Court.
Wayne Bradford, 56, Kerhonkson, NY
Bradford directed an employee who had worked as a machine operator for his company, Blue Ridge Woodcrafters, to falsely state that the employees injury had occurred while employed at another of Bradfords companies, Jes-Lyn Enterprises. Blue Ridge Woodcrafters had no workers' compensation insurance. Additionally, in reporting the injury to the NYSIF, Bradford himself falsely indicated that the employee was working at Jes-Lyn. Based on this fraudulent claim, the NYSIF paid out over $10,000 in benefits.
Other individuals arrested and charged as part of the sweep include:
Cherie Griffen, 35, Beacon, NY
Griffen is charged with fraudulently receiving $9,000 in benefits. The case is pending in Colonie Town Court.
Allen Paul, 39, Troy, NY
Paul is charged with fraudulently receiving $8,900 in benefits. The case is pending in Colonie Town Court.
David Podeswik, 53, Ilion, NY
Podeswik is charged with fraudulently receiving benefits in excess of $7,000. The case is pending in Village of Ilion Village Court in Herkimer County.
Nunzio Bonefede, 55, New York, NY
Bonefede was charged with fraudulently receiving benefits in excess of $6,000. On January 10, 2006, in Buffalo City Court, this defendant pleaded guilty to Attempted Fraudulent Practices and Insurance Fraud in the Fifth Degree, both class A misdemeanors. He was sentenced to three years probation.
Jeffrey Kleingardner, 30, Livingston Manor, NY
Kleingardner is charged with fraudulently receiving benefits in excess of $4,000. The case is pending in Union Town Court in Broome County.
Edmund Tietz, 53, Livingston Manor, NY
Tietz is charged with fraudulently receiving benefits in excess of $3,800. The case is pending in Union Town Court.
Zahida Pervez, 46, Latham, NY
Pervez is charged with fraudulently receiving benefits in excess of $3,000. The case is pending in Colonie Town Court.
Terry Rolling, 39, Niagara Falls, NY
Rolling is charged with fraudulently receiving benefits in excess of $3,000. The case is pending in Buffalo City Court.