December 17, 2007

Insurance Fraud Sweep Nets 10

Rice:  Investigation finds nearly $1M in workers’ comp theft

MINEOLA, NY – Nassau County District Attorney Kathleen Rice announced this morning the results of a year-long investigation into ten separate allegations of worker’s compensation fraud that were referred to her office by the state insurance officials committed to ridding the system of fraud.  Rice said the total theft uncovered as a result of this investigation amounts to $976,625.01.

“The theft of tax dollars by dishonest employers and employees who think they have a right to cheat the system will not be tolerated by this administration,” said Rice.  “We will continue to work with state authorities to hold accountable those who steal from the taxpayers of this state.”

SCOTT EDVABSKY, 37, of Levittown, owner of Scott Demo Contracting, Inc., allegedly applied for workers compensation insurance on March 12, 2004.  Mr. Edvabsky allegedly gave false information as to the scope of his company’s operation, number of employees and payroll.  Mr. Edvabsky allegedly submitted false insurance certificates to his contractors claiming he had workers’ compensation insurance.  As a result of Mr. Edvabsky giving false information, his premiums were undercharged and he owes the New York State Insurance Fund $699,032.56.  Mr. Edvabsky has been charged with Grand Larceny in the Second Degree, Insurance Fraud in the Second Degree, Offering a False Instrument for Filing in the First Degree, and a felony violation of the Workers Compensation Law for fraudulent practices.  He is being represented by John Tasolides, Esq., of Syosset.  He faces a maximum of 15 years in prison if convicted of the charges.

DENISE BETTS, 47, of Farmingdale, on January 20, 1990 sustained an injury to her back while working for Wendy’s. Ms. Betts was classified as permanently/partially disabled and was awarded worker’s compensation benefits of $95 per week.  From August 2005 to September 2007, Ms. Betts signed seven recertification letters in which she denied returning to work.  Investigation revealed that she returned to work for Command Printing and Mailing, Inc., in Farmingdale.  She was employed by Command Printing and Mailing from May 2005 to October 2007 and earned $89,537.85 during that time period.  She also failed to notify the NYS Insurance Fund of her return to work.  She fraudulently collected $11,115.00 in benefits.  Ms. Betts has been charged with Grand Larceny in the Third Degree, Insurance Fraud in the Third Degree, Offering a False Instrument for Filing in the First Degree, Falsifying Business Records in the First Degree, and a felony violation of the Workers’ Compensation Law for fraudulent practices.  She is being represented by Samuel J. DiMeglio, Esq., of Huntington.  She faces a maximum of seven years in prison if convicted of the charges.

CHEKESHA BETHEA, 34, of Freeport, allegedly submitted a false insurance claim to Liberty Mutual Insurance Company on December 1, 2006, for the theft of a diamond bracelet valued at $6,900.  Liberty Mutual denied the claim because Ms. Bethea had previously filed a claim with Chubb Insurance on April 2, 2006 for the same bracelet and received $6,900.  Ms. Bethea also allegedly lied under oath when asked if she had filed any previous insurance claims on the bracelet.  Ms. Bethea has been charged with Insurance Fraud in the Third Degree and Perjury in the First Degree.  She is being represented by the Legal Aid Society.  She faces a maximum of seven years in prison if convicted of either charge against her.

COSTAS HATZINKONTOS, 41, of Astoria, owner of KDP Renovations, Inc., in Glen Cove, allegedly submitted false insurance certificates to a contractor claiming he had workers’ compensation insurance.  The false insurance certificates were discovered during a routine audit conducted by the New York State Insurance Fund on the contractor.  As a result of the audit, the contractor had to pay $6,685.29 for hiring an uninsured contractor.  Mr. Hatzinkontos has been charged with Criminal Possession of a Forged Instrument in the Second Degree and Falsifying Business Records in the First Degree.  He is being represented by Mark Muccigrosso, Esq., of New York City.  He faces a maximum of seven years in prison if convicted of the charges.

VINCENT CATALA, 41, of Syosset, applied for workers’ compensation insurance on March 12, 2004 for his company Catala Bothers Industries. Mr. Catala also owned another company, Chestnut Construction.  Mr. Catala allegedly gave false information as to the scopes of each company’s operation, number of employees and payroll.  Mr. Catala allegedly submitted false insurance certificates to his contractors claiming he had workers’ compensation insurance for Chestnut Construction.  As a result of Mr. Catala giving false information, his premiums were undercharged and he owes the New York State Insurance Fund $118,109.  Mr. Catala also allegedly lied under oath at a Workers’ Compensation Board hearing when one of his employees claimed an injury and Mr. Catala denied that the worker was employed by his company and that his company, Chestnut, was not in business.  Mr. Catala has been charged with Grand Larceny in the Second Degree, Insurance Fraud in the Second Degree, Offering a False Instrument for Filing in the First Degree, Criminal Possession of a Forged Instrument in the Second Degree, Perjury in the First Degree, and a felony violation of the Workers’ Compensation Law for fraudulent practices.  He is being represented by Carmelo Garufi, Esq., of Garden City.  He faces a maximum of 15 years in prison if convicted of the charges.

ANTHONY BARBERA, 38, of Huntington, on August 30, 1993 sustained an injury to his back, right leg and burns to his right arm while working for Towne Bus Corporation as a mechanic. Mr. Barbera was classified as permanently/partially disabled and was awarded workers’ compensation benefits of $210 per week.  On November 22, 2006, the New York State Insurance Fund received notice that Mr. Barbera had been injured while tightening a chain on a trailer, and that he was employed as a foreman of an excavation crew for B. Reitman Blacktop, Inc., of Huntington Station, where he earned $15.00/hour. From September 1998 to April 2007, Mr. Barbera signed nine recertification letters in which he denied returning to work.  Investigation revealed that he returned to work in 2000 and that he failed to notify the NYS Insurance Fund of his return to work.  He fraudulently collected $91,728.00 in workers’ compensation benefits.  He has been charged with Grand Larceny in the Second Degree, Insurance Fraud in the Second Degree, Offering a False Instrument for Filing in the First Degree, Falsifying Business Records in the First Degree, and a felony violation of the Workers’ Compensation Law for fraudulent practices.  He is being represented by James Pascarella, Esq., of Garden City.  He faces a maximum of 15 years in prison if convicted of the charges.

RICHARD COSGROVE, 53, of Bellerose, on January 6, 1998 sustained an injury to his neck and back while working as a service technician for Skaggs-Walsh Electrical. Mr. Cosgrove was classified as permanently/partially disabled and was awarded workers compensation benefits of $325 per week.  The New York State Workers Compensation Board received an anonymous complaint that Mr. Cosgrove was working while collecting workers compensation benefits.  Surveillance revealed that Mr. Cosgrove was working at M&M Oil Burner and Supply Corp., in Cambria Heights. During the time Mr. Cosgrove worked at M&M, October 2006 through April 2007, he worked full time ‘off the books’ and earned between $10 and 20/ hour. He signed two recertification letters in which he denied returning to work and failed to notify the NYS Insurance Fund of his return to work.  He fraudulently collected $8,450.00 in benefits.  He has been charged with Offering a False Instrument for Filing in the First Degree, Falsifying Business Records in the First Degree, and a felony violation of the Workers’ Compensation Law for fraudulent practices.  He is being represented by Charles Ferzola, Esq., of Westbury.  He is facing a maximum of four years in prison if convicted of the charges.

ROBERT BASS, 52, of Jericho, allegedly submitted multiple prescription refund claims to his insurance company from 2001 to 2005.  The prescriptions were forged and never issued by the doctors. The insurance company paid out $7,710.45 in claims to Mr. Bass.  He has been charged with Grand Larceny in the Third Degree and Insurance Fraud in the Third Degree.  He is being represented by Harvey Weinberg, Esq., of Garden City.  He faces a maximum of seven years in prison if convicted of the charges.

JOSE GIRON, 28, of Brentwood, on June 21, 2001 sustained work-related injuries while working as a machine cleaner for Con-Strux LLC, in Westbury.  Mr. Giron was classified as permanently/partially disabled and was awarded workers’ compensation benefits of $200 per week.  During a routine surveillance, the New York State Insurance Fund observed Mr. Giron working while collecting workers’ compensation benefits.  Surveillance revealed that Mr. Giron was working at A & Z Pharmaceutical, in Hauppauge. Mr. Giron allegedly gave his employers a fraudulent social security card when he was hired and claimed to be “Olvin Escobar.”  During the time Mr. Giron worked at A & Z Pharmaceutical, May 2006 through September 2007, he earned $22,987.41.  During that time, he signed seven recertification letters in which he denied returning to work and failed to notify the NYS Insurance Fund of his return to work.  He fraudulently collected $4,800.00 in benefits.  He has been charged with Criminal possession of a Forged Instrument in the First Degree, Grand Larceny in the Third Degree, Insurance Fraud in the Third Degree, Offering a False Instrument for Filing in the First Degree, two counts of Falsifying Business Records in the First Degree, and a felony violation of the Workers’ Compensation Law for fraudulent practices.  He faces a maximum of 15 years in prison if convicted of the charges.   

STEVEN WIENCKOWSKI, 41, Sound Beach, on November 18, 2004 sustained an injury to his back while working for Eric T. Reeps Appraisals, Inc., in Massapequa. Mr. Wienckowski was classified as permanently/partially disabled and was awarded workers’ compensation benefits of $400 per week.  Routine surveillance revealed that Mr. Wienckowski was working at Restyle Kitchens, Inc., in Bohemia. The investigation also revealed that Mr. Wienckowski had been working from May 2005 to January 2007 and earned a total of $87,056.00.  During this time, Mr. Wienckowski signed four recertification letters in which he denied returning to work and failed to notify the NYS Insurance Fund of his return to work.  He fraudulently collected $35,680.00 in benefits.  He has been charged with Grand Larceny in the Third Degree, Insurance Fraud in the Third Degree, Offering a False Instrument for Filing in the First Degree, Falsifying Business Records in the First Degree, and a felony violation of the Workers Compensation Law for fraudulent practices.  He is being represented by the Legal Aid Society.  He faces a maximum of seven years in prison if found guilty of the charges.

Eight defendants have been arrested by District Attorney Investigators since December 6.  Monday morning, warrants were issued for the arrests of Jose Giron and Costas Hatzinkontos.

Assistant District Attorney Vickie Curran, of the DA’s Government & Consumer Frauds Bureau, is handling the case for the District Attorney’s Office. 

Rice thanked the New York State Insurance Department, the Insurance Fund, and the Inspector General for Workers Compensation for their involvement in these cases and their dedication to saving taxpayer dollars.

Eric R. Dinally, New York State Insurance Superintendent said:  “Businesses which commit premium fraud and individuals who file fraudulent workers’ compensation claims victimize all honest New Yorkers.  These are serious crimes that needlessly drive up the cost of doing business in this state.  In Insurance Department will continue to work with local and state agencies to aggressively combat workers’ compensation fraud.”

“Workers’ compensation fraud is a serious problem that New York State is attacking with a great deal of success,” said New York State Insurance Fund CEO David P. Wehner.  “Local law enforcement, such as Nassau District Attorney Kathleen Rice, understands how important this is. In these cases, crimes alleged to have been committed by claimants, businesses and contractors against New York State and against the workers’ compensation system represent close to $1.5 million in actual fraud, restitution and estimated future savings.  Working together with the New York State Insurance Department, the Workers’ Compensation Board Fraud Inspector General and local law enforcement, the New York State Insurance Fund continues to make reducing workers’ compensation fraud a top priority.”

"These arrests demonstrate the strong cooperation between the law enforcement community and the Workers' Compensation Board as we aggressively combat workers' comp fraud throughout New York State," said John H. Burgher, WCB Fraud Inspector General. "Whether the fraud is being conducted by an employer or an individual, we will find you and prosecute to the fullest extent of the law."