benefit fraud

Southern California Independent Union Boss Sentenced for Thefts

Posted on by Carl Horowitz

When going after organized corruption, the leader normally is the last to fall. Such was the case of the Romero family. Last Tuesday, January 5, John S. Romero, ex-president of the United Industrial Service Workers of America (UISWA), was sentenced in U.S. District Court for the Central District of California to 12 years in prison for his lead role in embezzling nearly $800,000 from the Colton (San Bernardino County), Calif.-based union’s health plan through various schemes. He had been convicted by a jury last February. His former wife, Evelyn Romero, and two adult children, John J. and Danae Romero, already had pleaded guilty and received sentences. He faces a restitution hearing in April. The actions follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards, Office of Inspector General and Employee Benefits Security Administration.

Union Corruption Update has covered this case since it first broke six years ago… Read More ➡

Los Angeles-Area Chiropractor Sentenced in $4.8M ILWU Benefit Scam

Posted on by Carl Horowitz

Anyone doubting that health care providers enable union benefit fraud probably hasn’t looked at Southern California lately. Mahyar David Yadidi, a Los Angeles-area chiropractor, was sentenced yesterday in federal court to 46 months in prison for submitting about $4.8 million in fraudulent reimbursements to an International Longshore and Warehouse Union health plan, and ordered to pay nearly $2 million in restitution. Yadidi had pleaded guilty last November after being charged in September. Two clinic employees, Ivan Semerdjiev and Julian Williams, had received prison sentences, respectively, of one year and six months. The actions follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards, Office of Inspector General, and Employee Benefits Security Administration, part of a larger investigation into Medicare and Medicaid fraud.  

Mahyar David Hadidi, now 38, a resident of West Los Angeles, operated a chiropractic clinic in nearby San Pedro called Synergy Healthcare and Wellness Center. Unfortunately, … Read More ➡

NYC Contractor CEO, Two Others Charged in Benefit Scam

Posted on by Carl Horowitz

Benefit fraud in the construction industry has become disturbingly common, especially in the New York City area. On July 30, Donal O’Sullivan, president and owner of Navillus Contracting, Inc., helped by two other Navillus executives, his sister Helen O’Sullivan and Padraig Naughton, respectively, treasurer and controller, were indicted in Brooklyn federal court on 11 counts related to their alleged defrauding of union benefit plans of more than $1 million over six years. The defendants were arrested, arraigned and then released on bail. In an August 3 letter to clients, Donal O’Sullivan stated, “These allegations are against us personally, and we have no choice but to commit ourselves to clearing our names.” All three defendants have stepped aside “temporarily,” with company operations chief Colin Mathers taking over as interim CEO.  

Founded in 1987, Navillus Contracting is one of the largest commercial construction firms in New York City, specializing in … Read More ➡

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

Posted on 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 by Carl Horowitz

Police unions have been receiving much criticism these past couple months, and two trustees of a New York City police 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 … Read More ➡

Pharmacy Owner Serving ILWU Members Sentenced in Compounding Scheme

Posted on 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 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 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 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 one jointly sponsored by the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association. 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 … Read More ➡

Labor Department Issues Final Rule to Halt Union Trust Fund Abuse

Posted on 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 ➡