This is Big

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Thief holding a social security card.

It’s hard to believe it’s been almost 20 years since 9-1-1 rocked the world. What’s also unimaginable is that it has taken almost that long to bust Dr. Raymond Pierre Paul, a Nassau County, N.Y., psychiatrist for carrying out a major Social Security disability fraud scheme that involved hundreds of people. Many of these fraud scheme participants included firefighters and police officers, who faked disabilities stemming from the terrorist attacks on that fateful day. (That is truly sad on so many levels.)

The Social Security Administration (SSA) Office of the Inspector General (OIG) received a tip from the New York State Disability Determination Services in 2008 and an investigation into the alleged disability scheme began. The NYPD Internal Affairs Division, along with the Manhattan District Attorney’s Office and New York State Office of the Attorney General joined in the fun and assisted with conducting a very large investigation that included undercover operations, two years of telephone and office monitoring, hundreds of surveillances, and social media warrants. (This was a very big operation folks.)

The results of this Herculean effort amongst law enforcement agencies revealed that more than 100 people had filed similar Social Security Disability Insurance applications sporting the same handwriting, ailments, and attorney – Raymond Lavallee – representing their disability cases. (Well, isn’t that a coincidence? I think not.)

The similar ailments belonged to retired firefighters and police officers who benefited from a New York City service-disabled pension for an orthopedic disability. It’s important to note that this type of disability did not meet the Social Security Agency’s definition of disability. And interestingly enough, all of the claimants had received documentation of psychiatric conditions provided by Dr. Paul and other medical providers that did meet SSA’s disability guidelines. (So, these fraudsters came up with a work-around.)

Pay attention to this interesting twist. Since investigators knew that many of the disability applicants were retired law enforcement officers that possessed permits for concealed weapons, they looked for evidence of conflicting facts regarding mental capacity as reported to NYPD vs. SSA. (Mental disabilities and guns do not go well together.) A deeper look revealed that dozens of disability beneficiaries were also concealed carry permit holders. That helped investigators find four ringleaders.

Raymond Levallee, an attorney and former FBI agent and assistant district attorney; Joseph Esposito, a former NYPD detective and Social Security Disability Insurance beneficiary; John Minerva, a retired NYPD detective and disability consultant for New York’s Detectives’ Endowment Association, a union representing NYPD detectives; and the late Thomas Hale, chairman/president of a disability consultancy firm were identified as ringleaders of this Social Security disability scheme.

Many of the disability applicants were recruited by the leaders of this scheme after they received their NYC disability pension. Hale typically referred these applicants to Paul or another psychiatrist. They were directed not to file for SSA disability until Paul or another psychiatrist had treated them for at least a year.

To participate in the scheme, the disability applicants agreed to pay their first 14 months of SSA disability benefits, which could be between $20,000 and $50,000. (This far exceeded the maximum amount of attorney fees allowable under Federal law.)  These applicants also agreed to continue regular monthly appointments, which were mostly short phone calls.

In all, 134 individuals were arrested and 116 were convicted of Social Security disability fraud. Dr. Paul cooperated with the investigation (good move) and was sentenced to 200 hours of community service, forfeited his medical license, and must pay $15,000 in restitution to SSA. Levallee, Hale, Esposito, and Minerva all previously pleaded guilty to conspiracy and agreed to pay restitution in millions of dollars in exchange for reduced sentences.

In addition, more than 300 individuals had their SSA benefits terminated as a result of this scheme that paid out $49 million in improper benefits. Thanks to the cooperation and tenacity of multiple law enforcement agencies, SSA has saved $52 million. (Now these benefits can be realized by individuals who actually deserve them.)

Today’s Fraud of the Day comes from an article, “New York Psychiatrist Sentenced for Disability Fraud,” published on WorkersCompensation.com on March 1, 2021.

New York, NY (WorkersCompensation.com) – The Inspector General for the Social Security Administration (SSA), Gail S. Ennis, today announced the sentencing of Dr. Raymond Pierre Paul, a psychiatrist practicing in Nassau County, New York. Dr. Pierre Paul helped facilitate a major Social Security disability fraud scheme that involved hundreds of individuals, many of them police officers and firefighters, some of whom feigned disabilities stemming from the September 11, 2001 terrorist attacks.

Dr. Pierre Paul cooperated with the investigation, and pleaded guilty to grand larceny in the third degree. He was sentenced today to 200 hours of community service, forfeiture of his medical license, and $15,000 restitution to SSA.

 

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.