Dec. 20, 2013
Farmingdale Hardware Store Owner
Pleads Guilty to Scam Bilking LIPA
Schuman paying $35,000 restitution &
sentenced to 210 hours community service
MINEOLA, N.Y. – Nassau County District Attorney Kathleen Rice announced that the owner of a Farmingdale hardware store has pleaded guilty today to falsifying records, in what was an attempt to steal tens of thousands of dollars from the Long Island Power Authority (LIPA).
Thomas Schuman, 45, of St. James, pleaded guilty to Offering a False Instrument for Filing in the Second Degree (an A misdemeanor), and his corporation pleaded guilty to the top charge in the case, Grand Larceny in the Third Degree (a D felony). He is paying $35,000 up-front restitution to LIPA and was sentenced to 210 hours of community service and a conditional discharge by Judge Scott Fairgrieve today. He is also paying a $1,000 fine.
“Thomas Schuman cheated Long Island electricity ratepayers with his scam and this sentence will ensure that his neighbors don’t end up footing the bill for his greed,” DA Rice said. “I’m grateful for the cooperation of LIPA officials to help us bring this defendant to justice.”
From 2009 to 2011, Schuman, the owner of Four Star True Value Variety Store on Main Street in Farmingdale, participated in LIPA’s Compact Fluorescent Light (CFL) coupon rebate program. The program allows stores to offer discounts on CFLs ranging from 50 cents to $3 per bulb. Buyers would fill out a rebate coupon for the stores to submit to LIPA, and LIPA would then reimburse the store.
In December 2011, LIPA conducted an audit and discovered that Four Star had submitted 923 fraudulent rebate coupons and was reimbursed $22,240. An investigation by DA Rice’s office revealed that Schuman instructed his employees to fill out the vouchers by instructing cashiers to use the phone book to find people who lived in the area and fill out a voucher in his or her name, even though they didn’t purchase a CFL and may never have been a customer of his store. Schuman gave the cashiers a daily quota of vouchers to fill out.
In the first quarter of 2011, the investigation revealed that Four Star was submitting approximately five coupons on behalf of each purported customer, and that it submitted 66 percent more rebate coupons than all Long Island Lowe’s stores combined.
Schuman and Four Star were found to have stolen an additional $19,200 from the utility as a participant in a LIPA-sponsored advertising program that reimbursed merchants that advertised the sale of CFLs. Schuman would advertise Four Star in the Long Island Pennysaver or Clipper magazine and then submit invoices that inflated advertising costs in order for Four Star to be eligible for a higher rebate.
Assistant District Attorney Vickie Curran of the Government & Consumer Frauds Bureau is prosecuting the case for DA Rice’s Office. Schuman is represented by F. Scott Carrigan, Esq.