benefit fraud Archives - National Legal & Policy Center

Wife, Daughter of Inland Empire Independent Union Boss Sentenced for Thefts

Posted on July 22, 2020July 28, 2020 by Carl Horowitz

The Romero family saga continues to wind down. On July 6, Evelyn Romero, ex-wife of John S. Romero, convicted former president of the United Industrial and Service Workers of America, was sentenced in U.S. District Court for the Central District of California to eight months of home confinement and two years of probation, and ordered to pay restitution in a sum yet determined, for her role in a conspiracy to fleece the Colton (San Bernardino County) Calif. union, mostly its health plan, out of roughly $900,000. A week earlier, on June 29, their daughter, Danae Romero, was sentenced to six months of electronic monitoring and two years of probation, and ordered to pay undetermined restitution, for her role in the schemes. They had pleaded guilty, respectively, in June 2018 and March 2017 following a multi-agency Labor Department probe.

Union Corruption Update has described this case several times since the handing … Read More ➡

NYC Police Union President, Treasurer Charged in $500K+ Benefit Scam

Posted on July 16, 2020July 17, 2020 by Carl Horowitz

Police unions have been receiving much criticism these past couple months, and two trustees of a New York City union benefit plan haven’t helped matters. Three days ago, July 13, Kenneth Wynder Jr., president of the Law Enforcement Employees Benevolent Association (LEEBA), was charged in U.S. District Court for the Southern District of New York with defrauding the LEEBA annuity fund of more than $500,000 following his arrest. Separately, LEEBA Treasurer Steven Whittick was charged with obstruction and making false statements in the case. Acting U.S. Attorney Audrey Strauss explained, “Today we have charged two leaders of a union that represents local law enforcement officers for engaging in criminal conduct.” The charges follow a joint probe by the FBI, the IRS, the U.S. Labor Department and the City Comptroller’s Office.

At the beginning of this month, Union Corruption Update analyzed the lengths to which police unions often go … Read More ➡

Pharmacy Owner Serving ILWU Members Sentenced in Compounding Scheme

Posted on June 10, 2020June 10, 2020 by Carl Horowitz

Erica Carey ran a pharmacy that served members of the International Longshore and Warehouse Union. Their health may be poorer for it. On October 30, 2019, Carey, owner of a Long Beach, Calif. pharmacy, was sentenced in Los Angeles federal court to three years of probation and ordered to pay more than $366,000 in restitution for defrauding the ILWU-Pacific Maritime Association (PMA) health plan. The main organizers of this $3 million-plus scam, brothers Berry and Dalibor Kabov, each had been sentenced that March to 121 months in prison for illegal sale of opioids and importation of controlled steroids, and failure to report about $1.5 million to the IRS. The actions follow a probe by the Drug Enforcement Agency, the IRS, the U.S. Postal Inspection Service, the U.S. Labor Department, and state and local authorities.

According to prosecutors, the Kabov brothers, both residents of the Brentwood section of Los Angeles, … Read More ➡

IBEW Business Manager in Pennsylvania Sentenced for Benefit Fraud

Posted on May 11, 2020May 19, 2020 by Carl Horowitz

Melvin Fishburn couldn’t delay the inevitable forever. Belatedly, he is going away for a while. On March 5, Fishburn, former business manager for International Brotherhood of Electrical Workers Local 743 and a trustee of the pension plan of the Reading, Pa.-based union, was sentenced in U.S. District Court for the Eastern District of Pennsylvania to 15 months in prison plus three years of supervised release for stealing funds from the plan. He also was ordered to pay $81,413 in restitution and an $800 special assessment. He had pleaded guilty last July to four counts each of embezzlement and wire fraud. The actions follow an investigation by Labor Department’s Office of Inspector General and the Employee Benefit Security Administration.

According to prosecutors, Fishburn, now 57, a resident of Charleston, S.C., during July 2010-June 2014 concocted an elaborate scheme to divert retirement plan assets to his own personal use. He created a … Read More ➡

Contractor Sentenced for $1.5M Ripoff of Pennsylvania Faculty Union Health Plan

Posted on April 22, 2020May 4, 2020 by Carl Horowitz

Michael Buchanan had overbilling down to a fine science. He is now paying the price. On February 27, Buchanan, founder and former operator of a Harrisburg, Pa.-based dental and vision claims processing service, was sentenced in U.S. District Court for the Middle District of Pennsylvania to 37 months in prison, to be followed by three years of supervised release, for stealing nearly $1.5 million from a benefit fund sponsored by the Association of Pennsylvania State College and University Faculties. He also was ordered to pay full restitution, part of which will include his brokerage account funds. Buchanan had pleaded guilty last May to one count of health care fraud. The actions follow an investigation by the FBI and the U.S. Labor Department’s Office of Inspector General.

The Association of Pennsylvania State College and University Faculties (APSCUF) for nearly 50 years has served as the collective bargaining representative for about 5,000 … Read More ➡

Four Indicted in Southern California Pain Clinic Scam; ILWU Plan Loses $3M

Posted on April 8, 2020May 18, 2020 by Carl Horowitz

The ingenuity underlying health care fraud in America is almost boundless. A recent bust of a scam in Southern California is a prime example. In the first week of February, federal agents arrested four persons for fleecing two benefit plans out of a combined $22 million of which $3 million came from an affiliate of the International Longshore and Warehouse Union (ILWU). The defendants – James Nate Bell, Regina Piehl, Michael Edwards and Sara Samhat – had been indicted on January 29 by a Santa Ana federal grand jury for collecting insurance reimbursements based on unnecessary compound cream prescriptions. The actions follow an ongoing probe by the FBI, the IRS, the Defense Department, and the Labor Department’s Office of Inspector General and Employee Benefits Security Administration.

The last decade has been rife with health plan fraud. In the Chicago area, for example, Dr. Richard Kolbusz received $2.6 million in phony … Read More ➡

Labor Department Issues Final Rule to Halt Union Trust Fund Abuse

Posted on March 23, 2020April 20, 2020 by Carl Horowitz

Union health, retirement and other benefit funds all too often serve as incubators for fraud and embezzlement. The U.S. Department of Labor, after over 15 years, may be on the verge of realizing an oft-thwarted tool for dramatically reducing these thefts. On March 6, DOL’s Office of Labor-Management Standards (OLMS) published a final rule requiring labor organizations with total annual receipts of at least $250,000 to file a financial report, Form T-1, detailing how their trust funds are spent. “Full disclosure of trust operations gives workers the information they need to make informed choices, and more information means better decisions,” said OLMS Director Arthur Rosenfeld. The regulation is effective April 6. But unions may go to court to block it – something they did twice, and successfully, during the Bush years.

As with any type of organization, labor unions present opportunities for illegal self-enrichment. That’s especially true for their health, … Read More ➡

Southern California Independent Union Boss Convicted of $800K Embezzlement

Posted on February 25, 2020July 2, 2020 by Carl Horowitz

The Romeros no longer are a family that stays together let alone steals together. On February 12, John S. Romero, former president of United Industrial and Service Workers of America (UISWA), was convicted by a jury in Los Angeles federal court of 14 felony charges related to the theft of nearly $800,000 from the health care plan of the Colton (San Bernardino County), Calif.-based union. His wife, son and daughter already have testified for the prosecution after pleading guilty to various charges. The four were arrested and indicted five years ago following an investigation by the Labor Department’s Office of Labor-Management Standards, Office of Inspector General and Employee Benefits Security Administration. Sentencing for the elder John Romero is set for April 27. He faces up to 130 years in prison.

National Legal and Policy Center has covered this case before (here and here). John S. Romero, now 73, … Read More ➡

Insurance Executive in New Jersey Sentenced for Role in $6.6M Scam

Posted on February 3, 2020February 4, 2020 by Carl Horowitz

Lawrence Ackerman isn’t going to spend too much time behind bars, but his business career deservedly is over. On January 15, Ackerman, founder of two fake health insurance brokerages, was sentenced in Trenton, N.J. federal court to six months in prison and six months of home confinement for his role in a $6.6 million fraud scheme. He also was ordered to pay $1 million in restitution to the welfare fund of United Auto Workers Local 2326, now based in South River, N.J. Ackerman had pleaded guilty in December 2018 after being indicted in January 2017. His partner in crime, former union president Sergio Acosta, was sentenced a little over a year ago to three years of home confinement, and ordered to pay $32,000. The actions follow a probe by the Labor Department’s Office of Labor-Management Standards, Office of Inspector General and Employee Benefits Security Administration.

Lawrence Ackerman, now 55, a … Read More ➡