News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 11, 2016

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A.G. SCHNEIDERMAN ANNOUNCES ARREST OF LONG ISLAND ATTORNEY AND OPERATORS OF “THREE-QUARTER” HOUSES ON CHARGES OF MEDICAID FRAUD AND MONEY LAUNDERING

Attorney Anthony Cornachio, Who Controls Two New York City Drug Treatment Programs, Allegedly Paid Yury Baumblit And Rimma Baumblit, Operators Of “Three-Quarter Houses,” To Force Residents To Attend Medicaid-Funded Drug Treatment

NEW YORK—Attorney General Eric T. Schneiderman today announced the arrest of attorney Anthony Cornachio, 74, of Garden City and charges against NRI Group, LLC (“NRI”) and Canarsie A.W.A.R.E., Inc. (“Canarsie”), which are Medicaid-enrolled drug treatment programs controlled by Cornachio. The Attorney General’s Medicaid Fraud Control Unit (“MFCU”) also charged three-quarter housing operators Yury Baumblit, 66, and Rimma Baumblit, 60, of Brooklyn, and their company Back on Track Group, Inc. In papers filed in New York City Criminal Court, Kings County and New York State Supreme Court, Kings County, prosecutors allege that Yury Baumblit and Rimma Baumblit, in exchange for payments from Cornachio’s companies, forced residents of their “three-quarter” homes to either face eviction or attend NRI and Canarsie regardless of the residents’ actual need for drug treatment services. All of the residences leased by Back on Track Group, Inc. and operated by Yury Baumblit and Rimma Baumblit as three-quarter homes were located in Kings County.  During the course of this scheme, which dates back to at least 2013, Cornachio allegedly paid Back on Track Group, Inc. over $900,000.00 in illegal kickbacks.  As a result of this kickback scheme, prosecutors allege that Cornachio, through NRI and Canarsie, submitted, and caused to be submitted, at least $1.7 Million in false claims for reimbursement to Medicaid. These claims, prosecutors allege, were fraudulent because they resulted from illegal kickbacks and were often medically unnecessary.

“We allege that the defendants engaged in a deliberate scheme to exploit those struggling with substance abuse in order to line their own pockets with millions,” said Attorney General Schneiderman. “Medicaid cannot serve as a personal piggy bank for criminals and fraudsters who have little regard for the well-being of their fellow New Yorkers. My office will continue to uphold the integrity of the Medicaid program to ensure that our tax dollars are put towards helping our most vulnerable citizens.”

“Individuals who victimize the most vulnerable New Yorkers should be prosecuted to the full extent of the law,” said Department of Social Service Commissioner Steven Banks. “By forcing residents to submit themselves to medical tests and treatments that in many cases they didn’t even need, these defendants have shown not only a clear intention to defraud Medicaid but also an absolute disregard for human dignity.”

In addition to the arrests, MFCU investigators executed a search warrant at Cornachio’s home in Garden City, Long Island and filed a False Claims Act and forfeiture complaint against the defendants seeking over $5 million dollars in damages plus penalties. 

Three-quarter homes in New York City are private entities that provide housing to indigent, formerly homeless individuals and those transitioning out of periods of incarceration, and are largely funded from each resident’s monthly housing allowance provided by the New York City Human Resources Administration (“HRA”). 

Anthony Cornachio, NRI and Canarsie have been charged with Grand Larceny in the First Degree, Money Laundering in the Second Degree, and violating Social Services Law § 366(d), which prohibits an enrolled Medicaid provider from paying kickbacks. Similarly, Yury Baumblit and Rimma Baumblit and their corporation, Back on Track Group, Inc. have been charged with Grand Larceny in the First Degree, Money Laundering in the Second Degree, and violating Social Services Law § 366(f), which prohibits individuals from acting in concert with an enrolled Medicaid provider and accepting the payment of kickbacks. 

Grand Larceny in the First Degree is a Class B felony with a maximum term of incarceration of twenty-five years in state prison.  Grand Larceny in the Second Degree and Money Laundering in the Second Degree are each Class C felonies with a maximum term of incarceration of fifteen years.  Social Services Law §366-f is a Class E felony with a maximum term of incarceration of four years. If convicted on all charges, the defendants each face up to 25 years each in state prison.

Cornachio is currently the village attorney for the Village of Island Park, Long Island, and a trustee of Nassau Community College.

In addition to the felony complaints filed, on Monday, the Attorney General obtained an order freezing the bank accounts and other property held by the defendants and attaching up to $5,221,649.28 of those assets.  The Attorney General obtained a temporary restraining order preventing dissipation or transfer of property controlled by defendants. 

Earlier this year, Yury Baumblit and Rimma Baumblit were indicted for a kickback arrangement they maintained with a different substance abuse treatment program. That indictment, which is currently pending in Kings County Supreme Court, charges Yury Baumblit and Rimma Baumblit with Grand Larceny in the Second Degree and other crimes; they remain incarcerated awaiting trial on that matter.

Throughout this investigation, the Attorney General has worked closely with the various city, state, and federal agencies. In particular, the Attorney General would like to thank the New York City Human Resources Administration (“HRA”) for its cooperation and valuable assistance throughout the investigation and notably the work of its Medicaid Provider Investigations & Audit Unit.  In addition, the Attorney General thanks the New York State Office of Alcoholism and Substance Abuse Services, the United States Department of HHS-OIG, and the Office of New York State Medicaid Inspector General Dennis Rosen, MFCU’s partner in combatting fraud against the Medicaid program, for their assistance. 

The investigation was led by MFCU Senior Investigator Albert Maiorano, with the support of Investigator David Ryan and Supervising Investigators Dominick DiGennaro and Michael Casado under the supervision of MFCU Deputy Chief Investigator Kenneth Morgan.   The audit investigation was led by Principal Auditor-Investigator Investigator Patricia Iemma, with the support of Senior Auditor-Investigator Nicholas Thottam and Auditor-Investigator Jillian White, under the supervision of Principal Special Auditor Investigator Emmanuel Archer and NYC Regional Chief Auditor Thomasina Smith.   Investigative support was provided by Supervising Legal Assistant Wendy Dorival and Confidential Legal Analyst Kelvin Caraballo.

The criminal case is being prosecuted by Special Assistant Attorneys General Megan Friedland and Erin Kelsh under the supervision of NYC Regional Director Christopher M. Shaw. Thomas O’Hanlon is MFCU’s Chief of Criminal Investigations–Downstate.  The civil case is being handled by Special Assistant Attorneys General Alee Scott and Christopher Y. Miller with the assistance of MFCU Civil Enforcement Chief Carolyn Ellis. MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney.   

The charges filed in this case, and in the previously-filed case noted above, are accusations. The defendants are presumed innocent until and unless proven guilty in a court of law.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 14, 2016

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A.G. SCHNEIDERMAN ANNOUNCES CEASE AND DESIST LETTER SENT TO OWNER OF PAVING COMPANY FOR ALLEGEDLY DEFRAUDING CONSUMERS

Richard Attenborough And Stevee Paige Castle-Lagerquist Allegedly Performed Unauthorized Services, Then Overbilled Customers

Schneiderman: We Will Hold Unscrupulous Contractors Accountable

WATERTOWN – Attorney General Eric T. Schneiderman’s Watertown Regional Office announced today they have issued a cease and desist letter to Tri-State Paving, ordering the company to stop doing work without contracts that comply with state law. In complaints received by the Attorney General's office, consumers state they were charged excessive amounts for paving work that was never agreed-upon, and that no contract compliant with state law was ever used.

Homeowners state that representatives of the Baldwinsville company, owned and operated by Richard Attenborough and Stevee Paige Castle-Lagerquist, approached them with "extra" asphalt and paving materials, offering to patch potholes and do other minimal paving work at a per-square-foot price. Tri-State then did extensive paving work without the authorization of the consumer, and demanded payments of thousands of dollars.

“Homeowners deserve to know the cost and extent of work being done on their homes, and contractors are obligated to follow the law,” said Attorney General Schneiderman. “Situations like this are precisely why the home improvement contractor law is so vital. My office will continue to hold unscrupulous contractors accountable and mandate that proper contracts are used.”

General Business Law Article 36-A requires home improvement contractors, before beginning work, to use contracts for every job where the total cost exceeds $500.00. The contract must be signed by both parties and contain: proposed starting and completion dates; a description of the work to be completed; materials to be provided; total cost of the contract; and include a notice to the consumer of their unconditional three-day right to cancel the contract without penalty, among other items.

Attorney General Schneiderman’s Office urges all homeowners to request multiple quotes and contracts for review before hiring home improvement contractors, and to be wary of contractors that approach them offering to do work.

This case is being handled by Assistant Attorney General Alicia M. Lendon and Investigator Chad Shelmidine, with assistance from Consumer Fraud Representative Michael Sprague, all of the Watertown Regional Office, which is led by Assistant Attorney General in Charge Deanna R. Nelson and Marty Mack, Executive Deputy Attorney General for Regional Affairs.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 15, 2016

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A.G. SCHNEIDERMAN ANNOUNCES MULTI-STATE SETTLEMENT WITH NFL PERMANENTLY BARRING LEAGUE-WIDE MANDATORY TICKET PRICE FLOOR

Agreement Also Prohibits The NFL From Directing Or Requiring Ticketing Practices Among Teams That Are Designed To Preclude Fans From Using Competing Exchanges; Settlement Continues The Office’s Focus On Cleaning Up Ticketing Industry

Schneiderman: My Office Will Continue To Fight For The Rights Of Sports Fans And Concertgoers By Ensuring That Markets Are Free, Competitive, And Not Subject To Manipulation

NEW YORK – Attorney General Eric T. Schneiderman today announced a multi-state settlement with the National Football League (“NFL”) resolving antitrust concerns about the NFL’s league-wide mandatory price floor policy. The policy required each of the 32 NFL member teams to impose a price floor on all secondary market ticket sales on the NFL’s Ticket Exchange and related websites officially sanctioned by the league. Under this arrangement, which the NFL terminated after the investigation began, sellers were not permitted to list tickets for resale on the NFL’s officially sanctioned resale sites at a price lower than the face-value of the ticket. 

“No sports fan should be forced to buy, or sell, a ticket at an artificially inflated price,” said Attorney General Schneiderman. “Under the NFL’s price floor scheme, fans were forced to pay inflated prices for even the least desirable NFL games. That is a slap to both sports fans and free markets. My office will continue to fight for the rights of sports fans and concertgoers by ensuring that secondary markets are free and competitive. In the meantime, I encourage every NFL team—and every team in professional sports—to heed the call of all sports fans and remove price floors from every team-authorized secondary ticket market.”

As a result of Attorney General Schneiderman’s investigation, the NFL eliminated its league-wide mandatory price floor policy during the course of the investigation, and that is enshrined in the conduct prohibitions of this agreement.  As forward-looking precautions, the settlement agreement also includes disclosure requirements in cases where an individual team imposes its own price floor, prohibits the NFL from directing or requiring ticketing practices among teams that are designed to preclude fans from using competing exchanges, and prohibits the NFL from interfering with an individual team’s efforts to coordinate anti-fraud measures with competing secondary ticket exchanges. The agreement also provides for payment in excess of $100,000 towards the costs of this multi-state investigation. 

This settlement is part of the Attorney General’s continued efforts to address troubling practices in the markets for  sports and entertainment tickets. The Attorney General’s office released a report titled Obstructed View: What’s Blocking New Yorkers From Getting Tickets on January 28, 2016, highlighting troubling practices in the live entertainment industry that keep affordable tickets out of the hands of ordinary New Yorkers.

In June, New York passed legislation increasing penalties for ticket brokers who use illegal bots to snatch up tickets, following legislation proposed by the Attorney General.

A copy of the agreement can be found here. 

The investigation and settlement are the result of a multi-state investigation lead by the Office of the Attorney General of New York. The agreement was also signed by the Attorney’s General of Florida, Massachusetts, Ohio, Pennsylvania and the District of Columbia.

The matter was handled by Assistant Attorneys General Jeremy R. Kasha, Bryan Bloom, Zach Biesanz, Volunteer Assistant Attorney General Mariya Naulo, and Antitrust Deputy Bureau Chief Elinor R. Hoffmann. The Antitrust Bureau is part of the Economic Justice Division, led by Executive Deputy Attorney General for Economic Justice Manisha M. Sheth. 

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 16, 2016

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A.G. SCHNEIDERMAN ANNOUNCES JOINT STATE AND FEDERAL $8 MILLION CIVIL SETTLEMENT WITH LONG ISLAND RADIOLOGY PRACTICE 

Long Island Radiology Firms And DoctorAgree To Pay $8 Million To Settle False Claims Act Allegations In Whistleblower Case 

Schneiderman: We Will Continue To Vigilantly Guard The Integrity Of MedicaidAnd Punish Those Who Steal From Our State

NEW YORK – Attorney General Eric T. Schneiderman and United States Attorney Robert L. Capers today announced that Zwanger & Pesiri Radiology Group, LLP, Zwanger Radiology P.C. and Dr. Steven Mendelson (collectively, “Zwanger”) will pay $8,153,727 to resolve allegations that the defendants knowingly submitted false claims to Medicare and Medicaid. The settlement resolved allegations that from January 1, 2003 through October 26, 2015, Zwanger submitted claims for services provided or supervised by physicians, or at a Zwanger location, that were not enrolled in Medicare and/or Medicaid and therefore ineligible for payment. Zwanger falsely claimed that Dr. Mendelson, who was a Medicare and Medicaid enrolled provider, had in fact performed the procedures. The settlement also resolved allegations that from January 1, 2008 through February 28, 2014, Zwanger submitted false claims to Medicare and Medicaid for certain radiology procedures that were not ordered by a treating physician. These procedures included the automatic performance of certain types of x-rays, and the automatic performance of ultrasounds in female patients, even these both procedures were not ordered by a treating physician. 

“These defendants knowingly overbilled Medicaid by millions, draining the program of important resources meant to help some of our most vulnerable individuals,” said Attorney General Schneiderman. “I thank our partners in law enforcement for helping us protect New York taxpayer dollars against fraud and waste. We will continue to vigilantly guard the integrity of Medicaid, and punish those who steal from our state.”

“Zwanger-Pesiri illegally pursued corporate profits at the expense of federal and state health care providers and taxpayers. Today’s guilty plea and approximate $10.5 million global settlement demonstrates our vigilance in bringing to justice those who put profits first and health care second,” said United States Attorney Capers. 

Zwanger is headquartered in Lindenhurst, New York and has offices in various locations on Long Island. It provides a variety of diagnostic testing, radiology and imaging services to referred patients.

Medicaid is a jointly funded federal-state program that provides health care to needy individuals. The joint settlement resolves allegations in a qui tam complaint filed in the United States District Court for the Eastern District of New York in 2013. As part of the settlement, Zwanger has agreed to enter into a corporate integrity agreement with the Office of the Inspector General, Department of Health and Human Services.  

This investigation was initiated after whistleblowers filed a qui tam lawsuit under provisions of the state and federal False Claims Acts, which allow private persons, known as “relators,” to file civil actions on behalf of the government and share in any recovery.  The State will pay a relator’s share in this case of $221,802 after full payment by Defendants.  New York State’s share of the total settlement is $1,232,236.

The investigation and settlement were the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of New York, and the New York State Attorney General’s Office.

At the federal court in Central Islip New York, Zwanger-Pesiri, Inc. pled guilty to federal criminal charges of health care fraud for illegally performing and billing for procedures that had not been ordered by treating physicians and agreed to forfeit $2.4 million in the criminal case.  After accepting the guilty plea, United States District Court Judge Joanna Seybert approved the settlement with the United States and the State of New York.  

Attorney General Schneiderman also thanked the Office of the Medicaid Inspector General for the State of New York its assistance in achieving the settlement with Zwanger Pesiri.

The case is captioned United States and the State of New York, ex rel. Donna Geraci and Linda Gibb v. Zwanger & Pesiri Radiology Group, et al., and is docketed with the U.S. District Court for the Eastern District of New York under Civil Action No. 13. Civ. 5002 (Seybert, J.).

The Attorney General’s Medicaid Fraud Control Unit conducted the state’s investigation led by Carolyn T. Ellis, Chief of the Civil Enforcement Division of the Medicaid Fraud Control Unit, Auditor Investigator Tatum Serfilippi, with assistance from Civil Enforcement Chief Auditor Stacey Millis and Senior Investigator Wayne Rivers. MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul Mahoney.

STATEMENT BY A.G. SCHNEIDERMAN ON REPORTS THAT THE PRESIDENTIAL TRANSITION TEAM IS CONSIDERING WAYS TO DISMANTLE STATE CONSUMER AND INVESTOR PROTECTION STATUTES, ALSO KNOWN AS BLUE SKY LAWS

NEW YORK- Attorney General Eric T. Schneiderman released the following statement after reports that the Presidential Transition Team is considering ways to dismantle state consumer and investor protection statutes, also known as Blue Sky laws:

“I am deeply troubled by reports that the Presidential Transition Team is considering ways to eviscerate some of the most basic consumer and investor protection laws in the country. Every day, state and local law enforcement effectively utilize Blue Sky laws to root out the worst types of fraud, corruption, and abuse on Wall Street and across major industries. In many cases, these anti-fraud statues are consumers’ and investors’ first line of defense against exploitation, particularly when retail and institutional investor dollars are in the hands of increasingly complex and opaque financial institutions. In the past few years alone, multi-state fraud investigations into Wall Street’s role into the collapse of the housing market have recovered over $95 billion in fines, penalties, and most important, consumer relief. The investigations and prosecutions made possible by state anti-fraud statutes are among the most effective deterrents of misconduct, and regularly lead to critical updates to federal securities laws and enforcement practices of consumer protection laws. Any attempt to gut these consumer and investor protections would severely undercut state police powers and only embolden those who seek to defraud and exploit everyday Americans. At a time of  regulatory uncertainty at the federal level, it is essential that we maintain the very laws that have helped state and local law enforcement keep consumers and investors safe for over one hundred years.”

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 17, 2016

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A.G. SCHNEIDERMAN ANNOUNCES INDICTMENT OF BROOKLYN REAL ESTATE DEVELOPER AND SIX ACCOMPLICES ALLEGEDLY INVOLVED IN SCHEMES TO STEAL MONEY FROM BANKS, U.S. FEDERAL GOVERNMENT

Defendants Created Shell Corporations, Forged Letters To Allegedly Defraud U.S. Dept. Of Housing And Urban Development And Financial Institutions From 2011-2014, According To Joint Investigation By A.G.’s Office And HUD  

Daniel Melamed – Currently Facing Charges For Unlawfully Evicting Tenants, Endangering Welfare Of Six-Year-Old Child – At Center Of New Charges

BROOKLYN - Attorney General Eric T. Schneiderman announced today the indictment of Brooklyn real estate developer Daniel Melamed, 40, his employee Carmen Morales, 51, former employee Denise Morales, 29, and associates Curt Joseph, 48, Christopher Magliocca, 29, Abraham Perez, 66, and David Soufeh, 37, for their roles in multiple schemes involving alleged residential mortgage fraud and larcenies throughout Brooklyn.

According to statements made by the prosecutor at arraignment and on documents filed in court, a joint investigation by the Attorney General’s office and the United States Department of Housing and Urban Development (HUD) revealed that Melamed, with his co-defendants, allegedly defrauded banks, HUD, and, ultimately, the taxpayers of New York State by creating shell corporations, forged letters, and other schemes between 2011 and 2014.  

Melamed was previously indicted in June 2015 for offering a false instrument for filing, endangering the welfare of a child, and unlawful eviction for allegedly tearing down a 14-unit apartment building around its three remaining tenants in an effort to remove them from their rent-stabilized apartments. Melamed was arraigned Wednesday in Kings County Supreme Court on charges of Grand Larceny in the Second Degree, Forgery in the Second Degree, and Residential Mortgage Fraud in the Second Degree.

“We have zero tolerance for mortgage fraud,” said Attorney General Schneiderman. “The defendants not only allegedly stole money from the federal government and ultimately New York’s taxpayers, but also cheated the general public out of opportunities to bid on reasonably priced properties that were in foreclosure. My office will continue working to ensure that fraudsters and swindlers are brought to justice no matter how long it takes.”

In one alleged scheme, Daniel Melamed, Carmen Morales, and Abraham Perez created and submitted false documents that purported to bolster Perez’s income and create the appearance that he intended to occupy 185 Hale Avenue in Brooklyn, NY, which was a requirement of HUD in order to receive the loan. Abraham Perez was approved for his loan on the basis of those false submissions and, in less than two years, he defaulted. HUD, which is taxpayer funded, paid over $480,000 to cover the loss.

“It is always disturbing when industry professionals who are expected to act as honest brokers exploit federal programs such as those administered by HUD’s Federal Housing Administration,” said Christina Scaringi, Special Agent in Charge, HUD OIG, Northeast Region.“We wish to thank the New York State Attorney General’s Office for their committed and steadfast efforts.”

Daniel Melamed and his associates also are charged with committing larcenies related to short sale fraud. Daniel Melamed and his associate David Soufeh allegedly recruited individuals who were in foreclosure with the promise of relief from mortgage debt and cash under the table. To facilitate this alleged crime, David Soufeh, Daniel Melamed, Curt Joseph, and Denise Morales created and submitted numerous false documents. Daniel Melamed and Denise Morales are accused of creating multiple forgeries by cutting and pasting the signatures of bank employees and letterhead from certain banks onto demonstrably false letters. Daniel Melamed, through an allegedly fraudulent corporation purportedly owned by Denise Morales, purchased one of these properties for $250,000 in 2013 and sold it a year later for $1,250,000.

In another scheme, Daniel Melamed, Denise Morales, and Christopher Magliocca are charged with attempting to deceive JP Morgan Chase into approving a short sale of a property owned by Melamed’s mother to a corporation controlled by Melamed. 

The charges against the defendants are merely accusations and they are presumed innocent until and unless proven guilty. If convicted, the defendants face up to seven years in prison.

The case was investigated by United States Housing and Urban Development Inspector General Special Agent William Martinez and Attorney General Investigator Anna Ospanova under the supervision of Supervising Investigator Sylvia Rivera and Deputy Chief Investigator John McManus. The Investigations Bureau is led by Chief Dominick Zarrella. Assisting in the investigation and providing forensic auditing analysis was Forensic Auditor Kristina Kojamanian under the supervision of Forensic Audit Section Chief Edward J. Keegan Jr.

The case is being prosecuted by Special Counsel and Chief of the Real Estate Enforcement Unit John R. Spagna and Senior Counsel Brian McDonald of the Public Integrity Bureau.

The Public Integrity Bureau is led by Bureau Chief Daniel Cort and Deputy Bureau Chief Stacy Aronowitz. Legal Support Analysts Allen George and Graham Lewis assisted in the prosecution of this case.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 17, 2016

New York City Press Office / 212-416-8060
Albany Press Office / 518-473-5525
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AMID SURGE OF BIAS CRIMES, A.G. SCHNEIDERMAN STANDS WITH DOZENS OF CIVIL RIGHTS LEADERS TO “STAND UP TO HATE,” ISSUES URGENT BULLETIN TO LOCAL LAW ENFORCEMENT OFFERING GUIDANCE IN IDENTIFYING AND PROSECUTING HATE CRIMES    

A.G. Schneiderman Vows Full Support Of State Law Enforcement To Protect Rights Of New York’s Most Vulnerable Communities   

Schneiderman: New York’s Diversity Is Our Greatest Strength, And We Will Not Allow Anyone To Turn that Strength Against Us 

NEW YORK – Alongside dozens of New York’s leading civil rights advocates, Attorney General Eric T. Schneiderman today announced that his office stands ready to protect and defend the constitutional and civil rights of all New Yorkers amid a surge of bias attacks nationwide and in New York. As his first action, the Attorney General’s office today issued an urgent bulletin to law enforcement offices statewide that provides guidance and support to identify, investigate, and prosecute hate crimes against immigrants, religious minorities, ethnic and racial minorities, women, LGBTQ New Yorkers, and other vulnerable communities.

Earlier Thursday, Attorney General Schneiderman held a roundtable discussion in New York City with immigrant community leaders and advocates to discuss concerns about the rise in hate crimes, harassment, and rhetoric targeting immigrant communities.

“As the state’s top law enforcement officer, let me assure anyone who is feeling scared or threatened at this time that this office stands behind you and has your back,” said Attorney General Schneiderman. “New York’s diversity is our greatest strength, and we will not allow anyone to turn that strength against us.”

The bulletin, sent to local law enforcement agencies and district attorney’s offices, identifies available hate crimes statutes and stresses the need for law enforcement to properly identify incidents as possible hate crimes in the first instance.

“In the last week we’ve seen over 200 incidents of Hate Crimes across the country,” said Imam Khalid Latif, executive director of the Islamic Center at New York University. “Now, more so than ever it is important for all of us from diverse backgrounds to unite – and in this unity it is not just about speaking out, but also supporting the creation of institutionalized mechanisms and policy such as those that Attorney General Schneiderman is advocating for today.”

“The 155,000 members of 32BJ SEIU reject any and all acts of hate and division and will continue to do everything we can to support and protect the most vulnerable among us, including undocumented immigrants, our Muslim brothers and sisters and LGBT New Yorkers,” said Hector Figueroa, President of 32BJ SEIU. “We are proud to stand with Attorney General Schneiderman in defending the rights of all New Yorkers and look forward to working with him and his team to stand up for the city we know and love – one free of fear, hate and terror.”

"I applaud Attorney General Eric Schneiderman for leading the effort and coordinating this useful document," said Thomas Zugibe, President, District Attorneys Association of New York.“This will be an important tool for law enforcement and district attorney offices across the state and will aid in the investigation and prosecution of hate crimes and bias crimes. New York’s District Attorneys are committed to keeping all communities in New York safe and I look forward to sharing this with my fellow district attorneys.”

“The spate of anti-Semitic vandalism that has struck communities from upstate New York to the boroughs of New York City is deeply concerning," said Evan R. Bernstein, New York Regional Director, Anti-Defamation League. “The appearance of swastikas and anti-Muslim rhetoric on college campuses and public property are searing and breeds fear and fuels anxiety that has risen since the end of the presidential election. We have been gratified by the strong statements of support that have come from our elected officials in response to the hate and hope it continues.” 

“LGBTQ immigrants are too often targets for violence and persecution. We are grateful to Attorney General Schneiderman for his leadership in ensuring that New York remains a safe haven for the queer immigrant community,” said Aaron C. Morris, Executive Director of Immigration Equality.

“Catholic Charities renews its commitment to support, assist and be in solidarity with immigrants and others who are feeling fearful and anxious in the aftermath of campaign rhetoric and proposed policies,” said Msgr. Kevin Sullivan, executive director, The Catholic Charities of the Archdiocese of New York. “We cannot allow a 'new normal' of hate, anger, and derision to be considered an acceptable means of dealing with disagreement and difference.  We will continue our efforts to better the lives of our neighbors in need and we will continue to partner with many, including government. When our perspectives diverge, we will seek to engage, build bridges and raise awareness in a way that is civil and strong.” 

“We are outraged at the recent increase in hateful rhetoric and acts of violence directed toward immigrants, toward the poor, and toward people of color generally. We will continue to defend and fight for these most vulnerable individuals, as we have for the last 140 years,” said Seymour James, Attorney-in-Chief, The Legal Aid Society.

“There has been a troubling wave of hate-motivated violence in the wake of the recent election, including against LGBTQ people,” said Human Rights Campaign’s Government Affairs Director David Stacy.“The tragic impact of these hate crimes is felt by families, friends and entire communities, creating fear and instability that ripples across the country -- including right here in New York. We applaud New York Attorney General Schneiderman for stepping up and taking action to help address these attacks and call upon law enforcement officials around New York to be vigilant and responsive.”

“We are thankful to Attorney General Eric Schneiderman for his leadership in these troubling times,” said Steven Choi, Executive Director of the New York Immigration Coalition. “We look forward to working closely with him and his staff in the coming months and years to ensure that New York State remains a welcoming space for immigrants, where their safety is prioritized and their diversity celebrated.” 

“We of different political and religious beliefs stand resolutely with A.G. Eric Schneiderman in denouncing any expression of hatred anywhere in our State. We will not tolerate prejudice against any person or group because we believe we all belong to one human family. Thank you A.G. Schneiderman for bringing us together in the battle against bigotry,” said Rabbi Joseph Potasnik, Executive Vice President, New York Board of Rabbis.

“Asian American Federation, and our member and partner agencies thank our state’s Attorney General for his leadership in providing protection for vulnerable communities,” said Jo-Ann Yoo, Executive Director, Asian American Federation. “As it has been his agenda since he took office, he has been a champion of immigrant communities.  More than ever, we need our law enforcement agencies to be on the front lines of addressing hate crimes against their fellow New Yorkers.”

Hate crimes – also known as bias-related crimes – are offenses that target particular individuals, groups of individuals, and property because of a bias or prejudice regarding race, color, national origin, ethnicity, gender, sexual orientation or identity, disability, religion, or some other protected characteristic as defined by law. These criminal acts include violence, threats and intimidation directed at individuals and groups as well as the destruction of public and private property.

Article 1, Section 11 of the New York State Constitution provides that no person shall be denied the equal protection of the laws of this state or its localities, and that no person shall, because of race, color, creed or religion, be subjected to any discrimination in his or her civil rights by any other person or by any firm, corporation, institution, or government agency.

A copy of the bulletin to law enforcement offices can be found here.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 17, 2016

New York City Press Office / 212-416-8060
Albany Press Office / 518-473-5525
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Twitter: @AGSchneiderman

A.G. SCHNEIDERMAN ANNOUNCES JAIL TIME FOR NURSING HOME AIDE WHO PUNCHED RESIDENT  

Sonya King To Serve Weekend Incarceration, Probation For Punching 87 Year-Old Resident 

Schneiderman: Nursing Home Staffers Who Physically Endanger Residents Will Be Held Accountable 

UTICA – Attorney General Eric T. Schneiderman today announced that Sonya King, 42, a Certified Nurse Aide, was sentenced on her plea of guilty to Endangering the Welfare of a Vulnerable Elderly Person or an Incompetent or Physically Disabled Person in the Second Degree, before Oneida County Court Judge Michael L. Dwyer.

King had previously admitted that on January 23, 2016, at Focus Rehabilitation and Nursing Center at Utica, she punched an 87 year-old male resident on the right side of his face causing fractures of the right orbit of the right eye, non-displaced fractures of the right and left nasal bones, and a non-displaced fracture of the right zygomatic arch (the bone below the eye).

“Nursing home residents and their loved ones deserve the peace of mind of knowing that residents will receive the best care possible, and will be treated with the utmost respect,” said Attorney General Schneiderman. “To physically assault an elderly resident is utterly reprehensible. This sentence sends the message that nursing home staffers who endanger the welfare of those in their care will be held accountable.”

King resides in Utica, New York. She worked at Focus for one and one half years. 

Judge Dwyer sentenced King to four months of weekend incarceration plus five years of probation.

The case was investigated by Special Investigator Scott D. Petucci.  The case is being prosecuted by Ralph D. Tortora, III, Regional Director, Syracuse Regional Office of the Medicaid Fraud Control Unit. Catherine Wagner is Chief of Criminal Investigations-Upstate. William Falk is the Deputy Chief Investigator Upstate. The Medicaid Fraud Control Unit is led by MFCU Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney.  

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 18, 2016

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A.G. SCHNEIDERMAN ANNOUNCES A LARCENY PLEA BY A ROCHESTER MAN FOR BILLING MEDICAID FOR AIDE SERVICES NOT PROVIDED TO A MEDICAID RECIPIENT

Charles Herring Falsified Time Sheets For Home Health Aide Services Not Provided 

Schneiderman: We Will Continue Working To Root Out Medicaid Fraud And Hold Those Responsible Accountable

ROCHESTER – Attorney General Eric Schneiderman today announced that 39 year-old Charles Herring pled guilty to grand larceny for his role in falsifying time sheets and billing Maxim Health Care and ultimately, the NYS Medicaid program, for home health aide services that were never actually provided.  Herring’s criminal conduct caused Maxim Health Care to bill Medicaid for home health aide services that were not performed.            

The plea was based on the following facts and circumstances: that Charles Herring, age 39, of 733 Portland Avenue, Rochester, submitted time sheets to Maxim Health Care falsely showing that an aide whom Herring hired, who was his girlfriend, provided home care services for a Medicaid recipient, for approximately 502 hours between January 1, 2015 and December 16, 2015, for time periods when that aide could not have provided the alleged care because either she was working another job or because the Medicaid recipient was at an adult day care program for the same hours of the aide allegedly claimed to have provided home health aide services during this time period. 

“Those who steal from Medicaid exploit the vulnerable people who depend upon the Medicaid program for needed care and compromise the integrity of our health care system,” said Attorney General Schneiderman.“My office will continue working to root out fraud by Medicaid providers in all industries, including the provision of home health aide services, and hold those responsible accountable.”

The services were allegedly rendered and paid through the Consumer Directed Personal Assistance Service Program (CDPAP), through which Herring was designated as the “self-directing other” for the Medicaid recipient and as such was responsible for the administration of her home health aide services, including approval of the aide’s time sheets submitted to Maxim. Based upon the time sheets submitted, Maxim billed the State Medicaid Program $9,036, while Herring and the aide received $5,020 in pay for 502 hours of services that were not provided, according to the charges filed.     

Rochester City Court Judge Stephen Miller presided over the proceedings where Herring entered a plea to Grand Larceny in the 4^th Degree, an “E” felony.  Judge Miller adjourned the matter to January 19, 2017 for sentencing.

The Attorney General thanks Supervising Investigator Colleen Balkin of OMIG for her assistance in this matter.

The case was investigated by Special Investigator Arthur Vasile and Auditor/ Investigator Stephen Sachman with assistance from MFCU Regional Chief Auditor Thomas Clarke and MFCU Deputy Chief Investigator William Falk.  The case is being prosecuted by Special Assistant Attorney General Timothy McFarland. Catherine Wagner is Director of the Rochester Regional MFCU Office and the Upstate Chief of Criminal Investigations. The Medicaid Fraud Control Unit is led by Director Amy Held and Assistant Deputy Attorney General Paul Mahoney.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 18, 2016

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A.G. SCHNEIDERMAN AND STATE EDUCATION COMMISSIONER ELIA OFFER GUIDANCE TO HELP ENSURE SCHOOLS ARE SAFE HAVENS FOR LEARNING

Letter To School Leaders Provides Resources For Complying With The Dignity For All Students Act And Preventing And Addressing Hate-Based Actions

NEW YORK—Attorney General Eric T. Schneiderman and State Education Commissioner MaryEllen Elia today sent a letter to school districts with guidance on how to ensure schools are safe havens where students are free to learn without fear of discrimination, harassment or intimidation directed toward students and employees as a result of their race, ethnicity, religion, immigration status, disability, sexual orientation, gender identity or any other basis.

“We will not allow hateful rhetoric and acts of discrimination to follow students into the classroom, which must remain a place for our children to learn and grow in a positive and safe environment,” said Attorney General Schneiderman. “I encourage all schools and educators to consider how they can foster constructive dialogue among students in order to combat hate and create a culture of understanding and respect. As always, my office is ready and willing to serve as a resource for schools that need assistance implementing the guidelines of the Dignity for All Students Act, designed to protect students from bullying and intimidation in schools. Families across New York should know that we are ready to ensure that our children will not be subjected to prejudice or bigotry.” 

“There is literally nothing more important than the safety of our children. As adults we are morally bound to ensure both their physical and emotional well-being,” Commissioner Elia said. “Students must feel safe in the classroom to be able to learn. As state and educational leaders, it is our responsibility to foster an open dialogue with students and employees about discrimination, harassment and intimidation and send a strong message that these types of behaviors will not be tolerated in our schools. I am so pleased that our state’s leadership – Governor Cuomo, Attorney General Schneiderman, Speaker Heastie and Majority Leader Flanagan – recognize the importance of supporting our schools as they address this difficult issue with our children. I encourage school leaders to host gatherings for students and employees to help prevent hate-based words and actions and to inform them of what to do if they witness or experience any such hateful acts.”

Assembly Speaker Carl Heastie said, “One of our greatest responsibilities as a society is protecting our children from any challenges to their well-being.  The recent increase in reports of harassment and intimidation in schools is extremely troubling, but we will remain vigilant in our efforts to ensure that New York is a safe home for all our citizens. As we have done before, we will work together to raise awareness and support our educators in their mission to provide safe havens where students can learn in inclusive environments and celebrate their diversity without fear or intimidation. The Assembly Majority is grateful to Commissioner Elia and Attorney General Schneiderman for their leadership in moving this issue forward. I would especially like to commend my colleague, Assembly member Danny O’Donnell, for his tireless efforts in championing the Dignity for All Students Act, which will now be our guide in achieving this important mission.”

“There is no question that recent incidents have raised concerns for our children and threaten the inclusivity and equality that we have all worked so hard to achieve for them,” said Assemblymember Cathy Nolan.“It is absolutely critical that students feel safe and supported during their time at school. Thanks to the leadership of Assembly member Danny O’Donnell and his commitment to protecting our children with the Dignity for All Students Act, we have a strong foundation from which to step up our efforts.  I commend Commissioner Mary Ellen Elia, Attorney General Eric Schneiderman, Speaker Heastie and the Board of Regents for their swift attention and response to these troubling events.”

To view the letter, visit here.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 18, 2016

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A.G. SCHNEIDERMAN ANNOUNCES CONVICTIONS IN AUTOMOBILE ACCIDENT RING ON LONG ISLAND

Nine Defendants Convicted For Staging Accidents Involving Rented Trucks And Submitting Over $150,000 In Fraudulent Insurance Claims

Schneiderman: If You Attempt To Exploit The Insurance System For Personal Gain, You Will Be Punished

NEW YORK– Attorney General Eric T. Schneiderman today announced the convictions of nine individuals for their roles in staging four automobile accidents in Nassau and Suffolk counties to fraudulently receive insurance payouts. The defendants, including ringleader Guilberto Jean, pleaded guilty to participating in a series of staged accidents in which rented U-Haul or Penske trucks were intentionally crashed into cars loaded with participants, who were then directed to be treated for fictitious injuries at medical clinics in Freeport and Valley Stream.  As a result of the fake accidents and falsely reported injuries, the defendants submitted fraudulent insurance claims totaling more than $150,000.

“Insurance fraud costs all New Yorkers by distorting the marketplace and increasing premiums,” Attorney General Schneiderman said. “Anyone who thinks they will be able to get away with these types of fraudulent practices should think twice. As today’s convictions demonstrate, if you attempt to exploit the insurance system for personal gain, you will be punished.”

In 2015, nine defendants were charged by the Attorney General’s Auto Insurance Fraud Unit (“AIFU”) in relation to four staged accidents:

• An “accident” dated October 30, 2010, at the intersection of Brook Avenue and Mildred Avenue in Bay Shore, in which a U-Haul truck rear-ended a Mitsubishi;
• An “accident” dated December 19, 2010, at the intersection of Patton Avenue and East Little Neck Road in Babylon, in which a U-Haul truck sideswiped a Chevrolet; and
• An “accident” dated June 16, 2011, at Straight Path Road in Suffolk County, in which a Penske truck rear-ended a Honda; and
• An “accident” dated June 29, 2011, at the intersection of Milburne Avenue and Harold Avenue in Hempstead, in which a U-Haul truck rear-ended a Toyota

The four accidents were staged in order to fraudulently bill insurance carriers and collect illegal payouts. In New York State, a person injured in a motor vehicle accident is automatically covered by the Comprehensive Motor Vehicle Insurance Reparations Act, commonly referred to as the No-Fault law. No-Fault insurance carriers are required to provide reimbursement for a wide range of medical and health services for injuries related to car accidents, up to $50,000 per person. In addition to medical coverage, a victim in a motor vehicle accident may be eligible to recover money from an insurance carrier for a bodily injury lawsuit stemming from injuries resulting from the accident.

According to court filings and admissions made by defendants at the time of plea, the defendants rented U-Haul or Penske trucks and then intentionally drove them into cars operated by other participants. The accidents were organized by ringleader Guilberto Jean, who recruited the U-Haul and Penske drivers and the occupants of the second vehicle with promises of cash payments or lucrative personal injury settlements. After they staged the accidents, the defendants lied to the responding police officers and pretended that the accident had been real.

After the “accidents,” the occupants of the cars struck by the U-Haul and Penske trucks were directed by Jean to seek treatment at Freeport Medical, P.C., located at 50 South Main Street in Freeport, NY or ZSA Medical Care, P.C., located at 71 South Central Avenue in Valley Stream, NY. At the clinics, the defendants filled out insurance forms that included false information about the accident and the defendants’ purported soft tissue injuries. Based on the fraudulent claims of injury, Freeport, ZSA and their associated providers billed insurance carriers over $30,000 for each accident, and over $150,000 in total.

The Attorney General’s prosecution of this staged accident ring successfully concluded today with the conviction of defendant Troy Russell, the driver of rental trucks in the December 19, 2010 and June 16, 2011 accidents.  Russell pleaded guilty to one count of Grand Larceny in the Fourth Degree and two counts of Insurance Fraud in the Fourth Degree, Class “E” felonies, and was sentenced today by Justice William C. Donnino in Nassau County Court to 1 ¾ to 3 ½ years in prison and $7,500 restitution.  

In May 2016, ringleader Guilberto Jean, the organizer of the staged accidents, was convicted of three counts of Insurance Fraud in the Third Degree, a Class “D” felony and three counts of Grand Larceny in the Third Degree.  Jean was sentenced to 6 months in jail, 5 years’ probation, $28,000 in restitution, and 300 hours of community service. 

In addition to Jean and Russell, seven other participants in the staged accident ring pleaded guilty to criminal charges.  Larry Henley, driver of the U-Haul truck in the June 29, 2011 accident and a passenger in the June 16, 2011 accident, was convicted of Grand Larceny in the Third Degree Insurance Fraud in the Fourth Degree, and was sentenced to a 3-year conditional discharge and $10,000 restitution. Armand Lamorissiere, a participant in the October 30, 2010, December 19, 2010 and June 29, 2011 accidents, was convicted of three counts of Insurance Fraud in the Fourth Degree and sentenced to 3 years’ probation. Jahmari Monroe, the driver of the U-Haul truck in the October 30, 2010 accident, was convicted of Insurance Fraud in the Fifth Degree, a Class “A” misdemeanor, and sentenced to 2 years’ probation and 300 hours of community service. Deja Mose, a passenger in the June 29, 2011 accident, was convicted of Insurance Fraud in the Fifth Degree and sentenced to a conditional discharge, 120 hours of community service and $3,500 restitution.  Tashauna Frye, a passenger in the December 19, 2010 accident, was convicted of Insurance Fraud in the Fifth Degree, Falsifying Business Records in the Second Degree and Petit Larceny, Class “A” misdemeanors, and sentenced to a conditional discharge and 300 hours of community service.  Alicia Holland, a passenger in the December 19, 2010 accident, was convicted of Insurance Fraud in the Fifth Degree, Petit Larceny, and Falsifying Business Records in the Second Degree and sentenced to a conditional discharge and $1,000 restitution. Christopher Hunter, who allowed his identity be to used in the June 29, 2011 accident, was convicted of Insurance Fraud in the Fifth Degree and sentenced to 150 hours of community service.

The Attorney General thanked the National Insurance Crime Bureau, New York State Department of Financial Services, New York State Department of Financial Services, the Nassau County Police Department, the Suffolk County Police Department, U-Haul International, Inc., Penske Truck Leasing Company, RepWest Insurance Company, Gallagher Bassett Services, Inc., Allstate Insurance Company, GMAC Insurance Company, 21st Century Insurance Company and Gary Armstrong of GDA Investigations Inc. for their valuable assistance in this investigation.

This case was prosecuted by Assistant Attorneys General Irwin Weiss and Timothy McNutt of the Auto Insurance Fraud Unit of the Attorney General’s Criminal Enforcement and Financial Crimes Bureau, with the assistance of Supervising Legal Analyst Paul Strocko and Legal Analyst Brandon Shapiro. The Auto Insurance Fraud Unit is led by Joseph G. D’Arrigo. The Criminal Enforcement and Financial Crimes Bureau is led by Bureau Chief Gary T. Fishman and Deputy Bureau Chief Stephanie Swenton.

The Attorney General's investigation was conducted by Investigator Adrian Klapper, under the direction of Supervising Investigators Edward Keegan and Natalie Shifrin and Deputy Chief Leonard D'Alessandro. The Investigations Bureau is led by Chief Dominick Zarrella. 

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 18, 2016

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STATEMENT BY A.G. SCHNEIDERMAN ON $25 MILLION SETTLEMENT AGREEMENT REACHED IN TRUMP UNIVERSITY CASE

NEW YORK – Attorney General Eric T. Schneiderman issued the following statement on the $25 million settlement agreement reached in Trump University case:

In 2013, my office sued Donald Trump for swindling thousands of innocent Americans out of ​millions of dollars through a scheme known at Trump University. Donald Trump fought us every step of the way, filing baseless charges and fruitless appeal​s​ and refusing to settle for even modest amounts of compensation for the victims of his phony university. Today, that all changes. Today's $25 million settlement agreement is a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university.

I am pleased that under the terms of this settlement, every victim will receive restitution and that Donald Trump will pay up to $1 million in penalties to the State of New York for violating state education laws. The victims of Trump University have waited years for today's result and I am pleased that their patience--and persistence--will be rewarded by this $25 million settlement.

NUEVA YORK - El Fiscal General Eric T. Schneiderman emitió la siguiente declaración sobre el acuerdo de por $ 25 millones alcanzado en el caso de la Universidad Trump:

En 2013, mi oficina demandó a Donald Trump por estafar a miles de estadounidenses inocentes de millones de dólares a través de un esquema fraudulento conocido como Universidad Trump. Donald Trump luchó contra nosotros en cada paso del proceso, presentando acusaciones infundadas y apelaciones infructuosas y negándose a hacer un acuerdo incluso por cantidades modestas de compensación para las víctimas de su falsa universidad. Hoy en día, todo eso cambia. El acuerdo de hoy de $25 millones de acuerdo es un cambio impresionante en la postura de Donald Trump y una victoria importante para las más de 6.000 víctimas de su universidad fraudulenta.

Me complace que bajo los términos de este acuerdo, cada víctima reciba restitución y que Donald Trump pague hasta $1 millón en multas al Estado de Nueva York por violar las leyes estatales de educación. Las víctimas de la Universidad Trump han esperado años para el resultado de hoy y me complace que su paciencia y persistencia sean recompensadas por este acuerdo de $ 25 millones.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 21, 2016

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STATEMENT FROM A.G. SCHNEIDERMAN ON DECISION BY NEW YORK COURT OF APPEALS REGARDING REVIEW OF INDIAN POINT NUCLEAR POWER FACILITY RELICENSING

NEW YORK – Attorney General Eric T. Schneiderman issued the following statement  on today’s decision by the New York Court of Appeals affirming the requirement that the consistency of relicensing the Indian Point nuclear power facility with State policies protecting the Hudson River Coastal Zone and its resources be addressed as part of considering  whether to relicense the facility to operate for an additional 20 years: 

“Today’s decision represents a major victory for the continued health and productivity of our state’s environment. Among our most important laws are those that protect sensitive ecosystems, including New York’s lower Hudson River and its natural resources. The court has now made it clear that policies protecting New York’s critical coastal resources are a necessary factor in considering whether to relicense the Indian Point facility.”

The New York State Department of State is designated by the State under the federal Coastal Zone Management Act (CZMA) to coordinate regulation of the State’s coastal zone.  Under the CZMA and the State's Coastal Zone Management Program, federal agencies can issue permits for activities affecting the coastal zones only if they are certified to be consistent with the affected state’s coastal zone program.  The “federal consistency” issue affects the federal Nuclear Regulatory Commission’s consideration of the application by Entergy, the owner of the Indian Point nuclear energy facility, for an additional 20-year renewal of the facility’s operating license.   

Entergy sued claiming that  the State’s coastal zone program exempted the facility from review under certain “grandfathering” provisions in the program.  In December 2013, the Supreme Court in Albany County dismissed Entergy’s lawsuit. But in December 2014 the Appellate Division reversed that decision and held that the project at Indian Point was exempt from coastal consistency review under an exemption in the coastal management program.  Today’s decision by the State Court of Appeals reverses the Appellate Division’s ruling and holds that the current relicensing application requires state review for consistency with New York’s coastal zone policies. 

Today, the Court of Appeals agreed with Attorney General Schneiderman's office and rejected Entergy’s claim that the Indian Point facility was “grandfathered” from coastal zone review. The Court determined that neither the CZMA nor the State’s program exempted relicensing for extended operations of nuclear power plants from coastal zone consistency review.  The Court agreed with Attorney General Schneiderman's position that Entergy’s license renewal application is subject to the consistency review process.

In November 2015, the NY Department of State denied a coastal consistency certification for Entergy’s relicensing application to the Nuclear Regulatory Commission.  The Department determined that Entergy’s relicensing application did not comply with New York’s federally-approved Coastal Management Program, particularly with respect to protections for coastal ecosystems, fish and wildlife resources and habitats. 

The case was handled bySolicitor General Barbara D. Underwood, Deputy Solicitor General Andrew D. Bing, Assistant Solicitor General Frederick A. Brodie, and Deputy Bureau Chief of the Environmental Protection Bureau Lisa M. Burianek.

 News from Attorney General Eric T. Schneiderman

A.G. SCHNEIDERMAN, MAYOR DE BLASIO AND GOVERNOR CUOMO ANNOUNCE REVOCATION NOTICES SENT TO OWNERS OF 178 BUILDINGS RECEIVING 421-A BENEFITS

Latest Action By Joint Real Estate Tax Compliance Program To Protect City Tenants And Taxpayer Dollars Means Owners Lose Tax Benefits Retroactively Unless They Comply Within 90 Days

NEW YORK—Attorney General Eric T. Schneiderman, Mayor Bill de Blasio and Governor Andrew M. Cuomo today announced that the Department of Housing Preservation and Development (HPD) issued letters notifying owners of 178 residential buildings – with a total of 1,400 rental apartments – that their 421-a tax benefits will be revoked retroactively if they don’t comply with the requirements of the 421-a program, including registering their apartments as rent-regulated.

“The 421-a tax program is a two-way street: landlords who receive these lucrative tax benefits must afford their tenants rent-stabilized leases and protections. But investigations conducted by my office have found that some landlords are flouting these requirements and instead, using the tax break to simply increase their profits,” said Attorney General Schneiderman. “We will never hesitate to protect tenants or New York City’s affordable housing stock, which is critical to the economic stability of many families.”

“Owners wrongfully receiving 421-a are on notice – comply with the law or your tax benefits will be revoked. Since day one, my Administration has made enforcement of rent regulation laws and protecting tenants a priority. With our state and law enforcement partners, we will continue to fight for a reformed 421-a program that better serves New Yorkers,” said Mayor Bill de Blasio.

"We're taking aggressive action to protect rent-regulated tenants from those who seek to cheat the system and deprive hardworking New Yorkers of a safe, affordable place to call home. These latest actions send a strong message – bad actors will be held accountable, these unscrupulous practices will not be tolerated and this Administration, with our local partners, will always work to protect the rights of millions of tenants across New York," said Governor Andrew M. Cuomo.

This is the latest action under the Real Estate Tax Compliance Program, a joint initiative of the Attorney General, HPD and the Governor’s Tenant Protection Unit to ensure building owners receiving 421-a benefits are in compliance with the law. 

In September, as part of the enforcement program, HPD instructed the City’s Department of Finance to revoke benefits to 35 other buildings. Those buildings have a total of 244 apartments, and would receive a total value of $4.5 million in tax benefits under 421-a.

The enforcement letters mailed yesterday are focused on 178 cooperative and condominium buildings that receive 421-a benefits but that have been operating as rental buildings without fulfilling the law’s rent-regulation requirements, including having their initial aggregate rent roll approved by HPD and registering their apartments as rent-regulated with DHCR.

In 2014, the agencies began coordinating on a broad tax compliance and enforcement effort. That year, the Attorney General initiated an investigation of multifamily rental buildings that claimed to be operating as cooperatives or condominiums. As a result, in 2015, compliance letters were sent to landlords of 285 buildings targeted by the Attorney General’s investigation, and the Real Estate Tax Compliance Program was established to address ongoing violations of rent stabilization requirements of the 421-a law.

Of the 285 buildings, 35 had their benefits revoked in September, and an additional 178 were sent revocation notices Monday. The rest either proved they are in compliance, or are curing the violations that have been uncovered.

“This is the latest shot across the bow at landlords who don’t play by the rules,” said HPD Commissioner Vicki Been. “Since the start of this Administration, we have sought to crack down on those who would abuse the system, cooperating across levels of government to use all of our enforcement powers to go after owners who try and skirt the law. We will not stop until every property is brought into compliance.” 

New York State Homes and Community Renewal Commissioner James S. Rubin, said, “The law is clear and so are we: arbitrary noncompliance with the rent laws is not an option. These buildings that received these 421-a benefits are subject to rent regulation; the apartments must be registered; owners must provide rent-regulated leases to the tenants; and annual rent increases must be limited to what is prescribed by the New York City Rent Guidelines Board and the Rent Stabilization Law. This collaborative enforcement initiative draws on the full force of both the State and the local municipality to impose penalties. Under the Governor’s leadership the Tenant Protection Unit is poised to address any violations of the rent laws.”

Tenants in rental buildings identified as non-compliant are entitled to the protections of a rent-stabilized lease by their landlords. Even if benefits are revoked, the 421-a law provides that the owners do not get out of the 421-a tax exemption requirements, including rent stabilization. In addition to HPD commencing proceedings to revoke their tax benefits, DHCR’s Tenant Protection Unit can simultaneously pursue additional actions against owners.

The vast majority of buildings identified as non-compliant contain less than 50 units and are located in four boroughs, all but Manhattan and with the majority in Brooklyn and Queens.

The Tenant Protection Unit (TPU), established by Governor Cuomo in 2012, created a new frontier in enforcement of the rent laws. Since its inception, the TPU has used data analytics, metrics, audits and investigations to proactively identify if landlords are complying with the rent regulation statutes. This initiative, along with the creation of the joint Tenant Harassment Prevention Task Force, is one TPU’s many multi-agency enforcement actions that protect tenants from harassment. To date, the Tenant Protection Unit has successfully returned more than 55,000 units to rent regulation.

Tenant Protection Unit staff working on the 421-a initiative include Attorney Thomas Mennecke, Special Assistant Jamie Reyes, TPU Legal Director Vernitta N. Chambers, and Forensics Director Harvey Akerman, under the supervision TPU Bureau Chief Gregory C. Fewer and under the overall supervision of DHCR Deputy Commissioner Richard R. White.

New York State enacted Section 421-a of the Real Property Tax Law in 1971 to incentivize the construction of rent- regulated housing and condominiums in New York City. The law provides a partial exemption from New York City property taxes for the owners of newly-constructed, residential multi-family buildings for at least ten years. Under the Governor’s’ leadership, when the current iteration of 421-a expired, additional affordability options were added to the law as well as fairer wage guidelines for those involved in the construction of these buildings. The current agreement negotiated by the Real Estate Board of New York and the Construction Trades Council of Greater New York, based on the framework supported by Governor Cuomo, provides for more affordability for lower-income families and a fair wage for workers. In 2015, the de Blasio administration worked to significantly reform the 421-a law to increase the amount of affordable housing required of every developer receiving the subsidy, require affordability for lower incomes than ever before, and demand affordable housing everywhere in the City. These reforms were captured in the 2015 state reauthorization of the program. The reauthorization also included a provision that suspended the law unless the Real Estate Board of New York and the construction trade unions agreed on the wages that would be paid to construction workers hired to build the projects receiving the tax exemption. The law remains suspended until the legislature re-enacts the program, or until REBNY and the Trades reach an agreement that does not require legislative action.

Further information on the Real Estate Tax Compliance Program is available on the Attorney General’s website, at http://www.ag.NY.gov/421a-compliance-program.

###

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 22, 2016

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A.G. SCHNEIDERMAN ISSUES FRAUD ALERT ON IMMIGRATION SCAMS 

Attorney General's Office, Immigration Groups Have Received An Increased Number Of Reported Scams In Recent Weeks

With Increased Anxiety In Immigrant Communities Due To Political Climate, Immigrants Should Be Aware Of Potential Scammers Offering Immigration Service

NEW YORK – In light of increased fear and anxiety in immigrant communities as a result of the current political climate, Attorney General Eric T. Schneiderman today issued a fraud alert warning immigrants to be aware of potential scammers offering immigration services. Immigration fraud affects large segments of communities and involves individuals or companies who target vulnerable immigrants by providing unauthorized and fraudulent immigration services. In recent weeks, the Attorney General’s office and many legal aid organizations that work with immigrant communities have received an increased number of calls and reported scams.

“In the past two weeks, we’ve seen intense fear and anxiety in immigrant communities. New York has zero tolerance for anyone who would prey on that fear to defraud immigrants and their families,” Attorney General Schneiderman said. “We will use all the tools at our disposal to bring to justice those who commit fraud against our immigrant communities.”

There has been a significant increase in the number of calls to immigration organizations, including regarding potential fraud. For example, since the election, the Northern Manhattan Coalition for Immigrant Rights has received an 266% increase in number of daily calls and 250% increase in number of daily walk-ins; on November 10^th alone, the organization received over 100 calls.

One of the most common scams right now is unsolicited calls from fake immigration officials. For example, one immigrant living in New York recently received a call that is the same as an official government immigration agency. The fraudster told him he was in the country illegally and must immediately pay $1,550. Federal authorities will never demand immediate payment, request personal sensitive information, or threaten you over the phone. If you receive a call like this, hang up immediately and report the possible fraud to our office.

To report complaints regarding immigration services, contact the Attorney General’s Immigration Services Fraud Unit Hotline at (866) 390-2992 or email Civil.Rights@ag.NY.gov. The Attorney General’s office will never ask for your immigration status or share immigration information with federal authorities if you contact the Immigration Services Fraud Unit Hotline.

Attorney General Schneiderman also highlighted key resources for New York’s immigrant communities to seek immigration and naturalization-related support.  Managed by Catholic Charities Community Services, the New Americans hotline is a toll-free, multi-lingual hotline that provides live assistance in receiving immigration and naturalization information and referrals, regardless of citizenship or documented status. All calls to the hotline are confidential and anonymous. Call 1-800-566-7636 (toll-free) anytime between 9:00am to 8:00pm Monday through Friday.

Attorney General Schneiderman also reminded all New Yorkers of commons forms of immigration fraud to protect them from becoming potential victims:

Unsolicited Calls From Fake Officials: One of the most common immigration services scams are unsolicited calls from someone claiming to be a government official or law enforcement officer that make threats such as deportation. Often times the number on caller ID may look like a legitimate government number. The United States Citizenship and Immigration Services (USCIS) and the Immigration and Customs Enforcement (ICE) will never request payment over the phone, so immigrants should be wary of scammers that ask for any sensitive or personal information, demand payment and threaten deportation if you do not comply.

Notario Fraud: In many Latin American countries a “notario” refers to someone who has the authority to render legal services. Unscrupulous “notaries” who are not attorneys often rely on this misunderstanding to exploit immigrants. They charge immigrants excessive application fees without ever submitting applications to the immigration authorities or may induce deportation by submitting applications for relief for which the immigrant is not eligible for or did not request.

Misrepresenting Legal Credentials: Individuals may falsely claim to be attorneys or wrongly suggest that they are able to appear before the immigration agencies or court. They take advantage of immigrants who will unknowingly pay exorbitant fees for their services. By misrepresenting their qualifications, these individuals can have a detrimental impact on the immigrants with whom they work. For example, immigrants who take advice from and work with these individuals may waive their right to obtain legal residency, be unnecessarily deported, or become subject to civil and/or criminal liability for the filing of false claims.

Fraudulent Promises to Expedite Process: This type of fraud concerns individuals who contend that they know employees at immigration offices who can expedite the processing of their clients applications. Accordingly, they request high fees for this special service, but fail to provide it.

Misinformation Fraud: Under this type of fraud, a provider will typically provide inaccurate or false information to the immigrant concerning his or her eligibility for an adjustment of status under a particular law. In these cases, the immigrant is usually not aware that they have been a victim of fraud until they receive a letter of ineligibility from immigration authorities. The provider knows the immigrant is not entitled to relief, or ineligible, but will file the application with immigration authorities regardless.

Immigration Affinity Fraud: Some providers target immigrants belonging to their same ethnic or racial group. Accordingly, they seek to gain advantage over other providers by claiming to identify with the ethnic, racial, national origin or community-based affiliations of the immigrant group.

Unauthorized Practice of the Law: Individuals may not be licensed to practice law but present themselves as attorneys or immigration law experts capable of providing legal advice and services.

Attorney General Schneiderman provided these key tips to avoid getting scammed:

• Only work with a licensed lawyer or an authorized provider.
• Never sign blank applications or documents you do not understand.
• Do not make payments over the phone or via email.

Additional resources can be found on the Attorney General’s website, including Know Your Rights: Immigration Services Fraud and Don’t Be a Victim of Immigration Fraud brochure. All authorized attorneys will be registered with the New York State Court. To verify an attorney, see here. 

“New York City is committed to protecting immigrant New Yorkers from fraudulent and unscrupulous immigration services providers.  At a time when the uncertainty following the election can create fertile ground for fraudulent providers and fear among immigrant communities, we thank Attorney General Schneiderman for his vigilance.  I look forward to continuing our collaboration with his office, the NYC Department of Consumer Affairs, and our community partners to raise awareness about immigration services fraud and connect New Yorkers to safe, free immigration legal services,” said Commissioner Nisha Agarwal, Mayor's Office of Immigrant Affairs.

"DCA is deeply committed to working with partners to educate communities about how to avoid predatory immigration service providers and to identifying targets for enforcement,” said Department of Consumer Affairs (DCA) Commissioner Lorelei Salas. “I urge anyone who has paid their hard earned money to an immigration service provider or notario público to provide advice on or prepare immigration documents, to file a complaint—either anonymously or knowing their information is safe with the City—to file a complaint with us by calling 311.”

 “Now more than ever it is critical that our fellow New Yorkers are kept safe from those who seek to take advantage of them,” said Steve Choi, Executive Director of the New York Immigration Coalition. “In a time when immigrant communities are terrified of what's to come, unscrupulous individuals may take advantage of immigrants fears by promising relief, permanent residency, or citizenship that they cannot actually provide. We must do everything in our power to ensure that immigrant communities are safe from this kind of harm. We stand with the Attorney General and commend him on his vigilance on behalf of our community members.”

“Over the past two weeks, the fear, anxiety, and uncertainty among immigrant communities has both deepened and intensified in a way that has not been seen for more than a generation,” said Mario Russell, Director, Immigrant and Refugee Services, Catholic Charities NY. “Today, Catholic Charities stands with the families, children, and workers who have come to America to build their dreams and build their communities; we stand with the Attorney General of New York in his important work to protect and safeguard the rights of its newcomers; and we stand for creating a just and compassionate society by affirming the dignity of each person. Catholic Charities' work to combat fraud against immigrants through its New York State New Americans Hotline (1-800-566-7637) is as essential to its mission as is its commitment to providing high competent legal services to thousands of immigrants each year. We are confident that in joining our work with the efforts, vigilance, and support of Attorney General Eric Schneiderman, immigrants will find some of the support and protection they need.”

“For immigrants, these are very uncertain times. During times of uncertainty, fraudsters prey on the fears of the most vulnerable, peddling hope and false promises,” said Angela Fernandez, Esq, Executive Director of Northern Manhattan Coalition for Immigrant Rights. “We applaud Attorney General Schneiderman’s resoluteness in using all of the tools at his disposal to protect immigrants from scams and fraud that have the ability of destroying lives.”

“In this time of increased fear and confusion for members of immigrant communities, it is more important than ever to prevent vulnerable people from being taken advantage of,” said Eva Hassett, Executive Director, International Institute of Buffalo. “We are grateful for the Attorney General’s efforts to work against fraud; immigrant and legal services agencies in Western New York will do our part to support his effort.”

“Empire Justice Center commends Attorney General Schneiderman for alerting New York’s immigrant communities to potential immigration related scams,” said Bryan D. Hetherington, Chief Counsel, Empire Justice Center. “They are rightfully fearful because of the anti-immigrant rhetoric of administration in Washington and unfortunately unscrupulous people are taking advantage of that fear.  Here in New York, immigrant communities are at the heart of our state and we recognize the many contributions they make. We appreciate that Attorney General Schneiderman has recognized the importance of creating resources to protect New York immigrants from scammers and is taking decisive action.”

“All New Yorkers deserve protection from those who would take advantage of their unfamiliarity with a new city, a new language, and a complex legal system,” said Manhattan District Attorney Cyrus R. Vance, Jr. “And no New Yorker – regardless of national origin or immigration status – should ever be afraid to report a crime. I thank Attorney General Schneiderman for his collaboration and commitment to defending our immigrant communities from scams and fraud.”

Acting Brooklyn District Attorney Eric Gonzalez said, “My Office’s Immigrant Fraud Unit is working diligently to prosecute scams that target the immigrant community and, earlier this year, secured a conviction against a fake lawyer who exploited immigrants by offering fraudulent services – the first conviction in New York State under the Immigrant Assistance Services Fraud Statute that was enacted in 2015. We also regularly conduct informational seminars and Immigration Forums to educate and raise awareness among immigrants about scams and other exploitative practices, and to offer assistance. I applaud Attorney General Schneiderman for his vigilance in this important area and join him in warning against unwarranted solicitations by those who seek to prey on this vulnerable population.”  

Queens District Attorney Richard A. Brown said, “Queens County is the most ethnically and culturally diverse areas in the United States with more than 2.3 million residents. With over 120 countries represented in our neighborhoods and over 160 languages spoken in our County, we take crimes committed against members of our immigrant communities seriously. Our Office of Immigrant Affairs (OIA), along with several other bureaus, investigates and prosecutes crimes that target immigrants. In addition, our OIA Office conducts extensive outreach initiatives in order to keep our communities informed on identifying and protecting against common immigration scams. Our Office is pleased to work with New York State Attorney General Eric Schneiderman and our other law enforcement colleagues in aggressively prosecuting immigration fraud cases.”

Bronx District Attorney Darcel D. Clark said, “The Bronx is home to more than 300,000 immigrants, and we are here to protect them from those who use language barriers or citizenship status to exploit their fears and defraud them in the areas of employment, housing and immigration documentation services. We will vigorously prosecute anyone who preys on immigrants, and we encourage all victims—no matter their status—to seek help from our Immigrant Affairs Unit.”

Attorney General Schneiderman’s Civil Rights Bureau is led by Bureau Chief Lourdes Rosado and the Social Justice Division is led by Executive Deputy Attorney General Alvin Bragg.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 28, 2016

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A.G. Schneiderman And I.G. Leahy Scott Announce Jail Time, $167K Restitution for DEC Employee Who Illegally Diverted Money from Contractor 

Defendant Will Serve 2-6 Years In State Prison For Stealing More Than $60K Through Two Schemes Involving Work At New York State DEC; Will Pay $167K In Restitution

Schneiderman: Sentence Reinforces Office’s Commitment To Rooting Out Governmental Corruption

ALBANY—Attorney General Eric T. Schneiderman and New York State Inspector General Catherine Leahy Scott today announced that David Comenale, a DEC employee, will serve a total of two to six years in state prison for diverting money from companies doing business with the state. At the time of the crimes, Comenale was employed by the NYS Department of Environmental Conservation as a project manager, primarily responsible for asbestos abatement projects.

Comenale, 50, of New York Mills, New York, having previously pleaded guilty to two counts of Grand Larceny 3rd, received a state prison sentence with a minimum of one year and a maximum of three years. Comenale received an additional one to three years for his conviction of Forgery 2^nd for a charge brought by the Oneida County District Attorney, to run consecutive to the OAG sentence, for a total sentence of two to six years in state prison. He has been ordered to pay $167,000 in restitution for the combined charges.

“Government employees who abuse their power for financial gain take more than just money – they chip away at the public’s faith in government,” said Attorney General Schneiderman. “This sentence reinforces our commitment to rooting out governmental corruption and ensuring that those responsible pay the price.”

“This former State worker used his position to conceive and finance complex criminal contracting and loan schemes enabling the thefts of tens of thousands of dollars,” said Inspector General Leahy Scott. “I will continue to use my office and my partnerships in law enforcement to pursue anyone who uses their public position for criminal self-entitlement.”

"This case is a perfect example of how the Attorney General, Inspector General and the Oneida County District Attorney's Office work together to pursue justice on behalf of the victims of fraud and financial crimes in Oneida County and the State of New York," said District Attorney McNamara, who thanked Attorney General Schneiderman, Inspector General Leahy Scott and their offices for the hard work and collaboration with his own economic crime unit on this investigation.  

Comenale admitted to stealing over $35,000.00 in 2013 from Midlantic Environmental Inc., a New Hartford asbestos contractor doing business with DEC. According to the Attorney General’s Office indictment, Comenale convinced Midlantic to advance $62,500 to a company controlled by Comenale for a DEC project. He then stole $35,000, in part by diverting money to companies he controlled.

Comenale was also charged with stealing approximately $26,000 in a 2014 fraudulent loan scheme involving Adirondack Bank and a company with DEC contracts.

The case was handled by Assistant Attorney General Christopher Baynes of the Public Integrity Bureau. The Public Integrity Bureau is led by Bureau Chief Daniel Cort and Deputy Bureau Chief Stacy Aronowitz.

The investigation was conducted by the Office of the New York State Inspector General with the assistance of Investigator David Buske and Deputy Chief Investigator Antoine J. Karam and Legal Analyst Sara Pogorzelski. Forensic auditing analysis was provided by Associate Forensic Auditor Jason W. Blair from the Forensic Audit Section, led by Chief Auditor Edward J. Keegan, Jr.  The Investigations Division is led by Chief Investigator Dominick Zarrella.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 29, 2016

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A.G. SCHNEIDERMAN ANNOUNCES INDICTMENT OF FORMER VILLAGE JUSTICE FOR ALLEGEDLY USING HIS POSITION AS JUDGE TO REDUCE FINES IN EXCHANGE FOR SEXUAL FAVORS

Delmar House Allegedly Reduced Fine For Defendant In Exchange for Sexual Favors While Serving As Justice For Village Of West Carthage

Schneiderman: Court Officials Who Exploit Position Will be Held Accountable

WATERTOWN – Attorney General Eric T. Schneiderman today announced the indictment of Delmar House, the former Village Justice for the Village of West Carthage Court in Jefferson County, charging him with one felony count of Bribe Receiving in the Third Degree and one felony count of Receiving a Reward for Official Misconduct in the Second Degree. 

House was the Village Justice for the Village of West Carthage Court from January 1, 2008 through December 31, 2015.  He is charged with using his position as a judge during that time period to reduce a fine for a defendant who appeared before him, in exchange for sexual favors from that defendant. 

“Any court official who exploits their position to elicit sexual favors shows blatant disregard for the wellbeing of their victim, the trust of the public, and for the judicial system as a whole,” said Attorney General Schneiderman. “We will keep working to root out public corruption and hold those responsible accountable.”

According to filed documents and statements made in court today, in or about April 2015, House, 49, of Carthage, agreed to and did reduce the fine for a defendant appearing before him in the Village of West Carthage Court for Vehicle and Traffic Law offenses, in exchange for sexual favors from that defendant.  In addition, according to documents filed in court and statements made in court today, House paid a portion of that defendant’s fines in exchange for additional sexual favors.  The defendant faces up to seven years in state prison if convicted. He was arraigned today before the Honorable Kim H. Martusewicz in Jefferson County Court.  The defendant pled not guilty and was released on pre-trial release and will be back in court on January 17, 2017 for a court conference.

The charges against the defendant are merely accusations and the defendant is presumed innocent unless and until proven guilty.

The Attorney General thanks the New York State Commission on Judicial Conduct, New York State Police Investigator Joseph Maurer and the New York State Police for their work on this matter.

This case is being prosecuted by Assistant Attorney General Mary Gorman of the Public Integrity Bureau under the supervision of Bureau Chief Daniel Cort and Deputy Bureau Chief Stacy Aronowitz, with the assistance of Senior Analyst Joseph Conniff.  The investigation is being handled by Investigator David Buske of the Investigations Bureau, with assistance from Investigators Joel Cordone and Samuel Scotellaro and support from Supervising Investigator Richard Doyle, under the supervision of Deputy Bureau Chief Antoine Karam and  Chief Dominick Zarrella.

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
November 29, 2016

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A.G. SCHNEIDERMAN ANNOUNCES INDICTMENT AND ARRAIGNMENT OF CLINIC OPERATOR FOR ALLEGEDLY DEFRAUDING MEDICAID BY OFFERING BOGUS SUBSTANCE ABUSE TREATMENT 

Natalia Dochim Allegedly Induced Patients Into Fake Substance Abuse Treatment, Then Pocketed Millions Of Dollars 

Schneiderman:  We Will Continue To Root Those Who Prey On New Yorkers In Need Of Substance Abuse And Addiction Treatment

NEW YORK—Attorney General Eric T. Schneiderman today announced the indictment and arraignment of Natalia Dochim, 39, of Nyack, New York, and corporate entities Miromedical P.C. (“Miromedical”) and Ferrara Medical Care, P.C. (“Ferrara”), on charges of Grand Larceny in the First Degree, Grand Larceny in the Second Degree, Health Care Fraud in the Second Degree, Money Laundering in the Second Degree, and Grand Larceny in the Fourth Degree.  Prosecutors allege that Dochim, Miromedical, and Ferrara submitted claims for reimbursement for substance abuse treatment services to Medicaid and to MetroPlus, a state-funded managed care organization (“MCO”), when they were not certified to provide such services and for medical services allegedly rendered to MFCU undercover investigators that never occurred.

“The opioid epidemic should not serve as an excuse for unscrupulous individuals to illegally line their own pockets,” said Attorney General Schneiderman. “Medicaid is intended to protect some of our most vulnerable citizens, and we will continue to root out those who prey on New Yorkers in need of substance abuse and addiction treatment.”

Prosecutors allege that Dochim, aided by co-conspirators in her scheme, lured Medicaid patients to Miromedical and Ferrara by paying kickbacks and offering prescriptions of Suboxone, a narcotic drug used to treat opioid addiction.  Once recruited, patients at Miromedical and Ferrara, prosecutors allege, encountered the façade of a substance abuse treatment program.  Medically appropriate and necessary medical histories were not always obtained, physicals were not taken, initial counseling did not occur, and there was a complete lack of appropriate follow-up and monitoring.  Consequently, all patients were treated the same; mandated to enroll in one particular MCO (MetroPlus), sent to a purported “detox” program, and prescribed Suboxone at the maximum dosage in lieu of legitimate substance abuse treatment.  If actually provided, prosecutors allege, the so-called “detox” treatment that patients were required to obtain was, according to the claims submitted by Miromedical and Ferrara, merely vitamin injections, which is not an approved treatment for opioid addiction. 

Thereafter, prosecutors charge, Dochim, through Miromedical and Ferrara, submitted claims to MCOs and to Medicaid that bore little to no resemblance to the medical services actually rendered.  Prosecutors allege services such as spirometry, a pulmonary function test, and allergy testing, were routinely billed but never provided.  Patient “recruiters” working inside Miromedical and Ferrara, it is alleged, also openly offered to buy back patient’s Suboxone prescriptions for cash.

Relying on the accuracy of substance abuse treatment claims submitted by Dochim, prosecutors allege that MetroPlus paid over $2.3 million and that Medicaid paid over $330,000 to Dochim, Miromedical and Ferrara, funds to which they were not entitled and which Dochim is alleged to have then laundered through various shell companies.

Bronx County Supreme Court Justice William Mogulescu arraigned Dochim, Miromedical and Ferrara Medical Care on the charges and adjourned the matter to December 9. If convicted, the defendant faces up to twenty-five years in prison.

Bail was set at $250,000 bond over $100,000 cash, with a condition that the defendant must wear an ankle monitoring bracelet should she make bail.

The Attorney General previously obtained an order freezing the bank accounts and other property held by the defendants and attaching up to $7,743,013.71 of those assets. The Attorney General also obtained a temporary restraining order preventing dissipation or transfer of the property controlled by the defendants. 

The Attorney General would like to thank the New York City Human Resources Administration (“HRA”), notably the work of HRA’s Medicaid Provider Investigations and Audit Unit, and the New York State Office of Alcoholism and Substance Abuse Services for their partnership and valuable assistance throughout the investigation. In addition, the Attorney General thanks the United States Department of Health and Human Services-Office of the Inspector General and the New York State Office of the Medicaid Inspector General, MFCU’s partners in combatting fraud against the Medicaid program. The Attorney General also thanks MetroPlus and Healthfirst for their cooperation in this investigation.

The investigation was led by Senior Investigator Albert Maiorano and Investigators David Ryan and Julie Clancy with the assistance of Supervising Investigators Dominick DiGennaro and Michael Casado under the supervision of Deputy Chief Investigator Kenneth Morgan. Audit support was provided by Principal Auditor-Investigator Patricia Iemma and Auditor-Investigator Coleman Williams under the supervision of MFCU NYC Chief Auditor Thomasina Smith.  Investigative support was provided by Confidential Legal Analyst Nicole Maher.  

The criminal case is being prosecuted by Special Assistant Attorneys General Erin Kelsh and David Arias with the assistance of MFCU NYC Regional Director Christopher M. Shaw. Thomas O’Hanlon is MFCU’s Chief of Criminal Investigations-Downstate. The civil case is being handled by Special Assistant Attorneys General David Abrams, Gerri Gold and Elizabeth Silverman with the assistance of MFCU Civil Enforcement Chief Carolyn Ellis.  MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney.   

The charges filed in this case are merely accusations. The defendants are presumed innocent unless and until proven guilty in a court of law.