At the Indiana/Kentucky/Ohio Regional Council of Carpenters (IKORCC), theft seems to be a way of doing business. And for Luka Kljajic, business was good until he was caught. On July 25, Kljajic, a member of the Greenwood, Ind.-based council, pleaded guilty in U.S. District Court for the Northern District of Indiana to submitting nearly $50,000 in false claims to a union-sponsored benefit plan and to assisting other union members in submitting false claims to the plan. Sentencing is scheduled for November 19. The plea follows an investigation by the U.S. Labor Department’s Office of Inspector General and Employee Benefits Security Administration (EBSA).
According to prosecutors, Kljajic during 2012-14 submitted fake reimbursement requests for medical plan expenses and helped other union members with similar deceptions. In the case of the latter offenses, he would receive fees ranging from $100 to $500 per claim. In his written plea agreement, he admitted to … Read More ➡ “Carpenters Member in Indiana Pleads Guilty to Embezzlement”
As a Certified Fraud Examiner, Salvatore Armao knew he was in no position to do anything but plead guilty. That’s why he did just that. Last Thursday, August 2, Armao, founder and managing partner of a Long Island, N.Y.-based accounting firm, Armao LLP, pleaded guilty in U.S. District Court for the Southern District of New York to falsifying financial records filed with the Department of Labor to conceal a scheme by an unnamed labor union president to embezzle more than $100,000 over a number of years from a related benefit plan. Armao and a principal officer of his firm, Karen Auer, had been charged on June 1 with aiding and abetting the thefts. Auer, to no surprise, pleaded guilty on August 3. The actions follow a probe by the FBI, and the Labor Department’s Office of Inspector General and Employee Benefits Security Administration.
According to prosecutors, the unnamed president of … Read More ➡ “Account Executives in Long Island Plead Guilty to Coverup”
It takes some real teamwork to fleece the U.S. Department of Labor out of tens of millions of dollars. Nermin Awad El-Hadik, unfortunately, was an integral part of the team. On June 29, Ms. El-Hadik, owner of a Houston pharmacy, was sentenced in U.S. District Court for the Western District of Texas to five years in prison and three years of probation for paying more than $5 million in kickbacks to a Texas-based medical provider in return for referrals who then could be overcharged on prescriptions. She also was ordered to pay restitution. The kickbacks were part of a much larger scam to create fake or exaggerated worker’s compensation claims. El-Hadik had pleaded guilty in November 2016. The action follows a probe by the FBI, Army, Postal Service and Labor Department.
Nermin El-Hadik, now 42, a resident of Bellaire, Tex., was the owner-operator of Hope Pharmacy in Houston. During March-December … Read More ➡ “Texas Pharmacist Sentenced for Benefit Fraud”
For more than seven years, John McNamee, Jr. avoided getting caught. Then reality caught up. On February 15, McNamee, formerly president and secretary-treasurer of Stage and Picture Operators Local 829, an affiliate of the International Alliance of Theatrical Stage Employees (IATSE), was indicted in Manhattan federal court on charges of embezzling nearly a quarter-million dollars from the New York City union and filing false financial reports. The following day, on February 16, he was arrested and arraigned. The union is also on the hot seat in a much more expensive way. On March 14, the U.S. Department of Labor (DOL) filed suit against the trustees of the local pension plan, alleging they had conducted more than $3 million worth of illegal transactions since 2006 and had failed to perform due diligence in managing another $11 million in assets.
Stage and Picture Operators Local 829 represents exhibition employees for New York … Read More ➡ “New York IATSE Boss Indicted; DOL Sues Benefits Trustees”
Caleb A. Gray-Burriss built his union from the ground up. Now he’s run aground, and might be headed for an indictment. Federal authorities revealed that in April they had raided the home and office of Burriss, founder and head of the 800-member National Association of Special Police and Security Officers (NASPSO), based in Washington, D.C. According to an affidavit filed by the U.S. Labor Department’s Office of Inspector General, department investigators searched for documents related to the disappearance of $95,000 in pension and health plan dues, plus “numerous, ongoing withdrawals” from the accounts to cover travel and other personal expenses.
The probe comes nine months after the Department of Labor filed a civil complaint accusing Burriss and the union of having “dealt with assets of the pension plan in their own interest or for their own account.” DOL regulators sought to remove Burriss as a trustee of the health and … Read More ➡ “Founder-President of D.C. Union Searched, Faces Probe”