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Former Employees of Connecticut Healthcare Insurance Firm Charged in $17.9 Million Scheme to Defraud Client

pexels-photo-48604-300x191The U.S. Attorney’s Office for the Southern District of New York announced the arrest of four former employees of a Connecticut healthcare insurance firm accused of defrauding a client out of millions meant for healthcare claims.

The complaint names Patricia Riccardi, Anthony Riccardi, Erin Verespy, and Vanessa Battle, all of Connecticut, as defendants. They are each charged with one count of conspiracy to commit wire fraud and one count of wire fraud. Attorney information was not available.

According to the complaint, the four defendants were managers and employees of a Wilton-based healthcare insurance service called Employee Benefits Solutions LLC (EBS), which provided healthcare insurance-related administrative services to companies that choose to “self fund” employee healthcare plans. EBS is responsible for administering, processing, and paying healthcare claims for its clients’ employees in exchange for an administrative fee.

The complaint alleges that between 2015 and 2019, EBS represented an automobile dealership based in Westchester County, New York. EBS sent the dealership “check register” invoices twice a month that listed all employee healthcare expenses. However, a majority of the checks the dealership paid to EBS were never actually sent to the healthcare providers.

EBS allegedly administered a bank account on behalf of the dealership to specifically pay for the company’s employee healthcare claims. The dealership funded all the check register invoices EBS sent to that account, expecting EBS to use the money to promptly pay the claims. Records show that from 2015 to 2019, the dealership transferred approximately $26 million to EBS.

An estimated $17.87 million in the dealership’s healthcare payments were misappropriated, according to the complaint. A majority of the funds were transferred by EBS into its operating account, where they were used for personal expenses by the defendants. Bank records reportedly revealed that two of the defendants used the funds to pay their home mortgage expenses, as well as a personal credit card account with expenses relating to golf and boating.

The defendants allegedly took steps to conceal their alleged fraud from the dealership by creating and sending doctored bank statements and checks to make it look like the healthcare claims were being paid.  In January 2019, Anthony Riccardi allegedly sent several bank statements to the client that showed claims were being paid out by EBS. The statements hid the millions EBS had transferred into its operating account, the complaint alleges. Another defendant also purportedly forwarded the phony statements to an auditor for the dealership’s insurance underwriter.

“As alleged in the criminal complaint, the defendants abused their positions as administrators of client healthcare plans for years by creating false and inflated invoices and then misappropriating millions of dollars for their own uses,” said acting U.S. Attorney Audrey Strauss. “As further alleged, the defendants sought to conceal this fraud by creating false bank statements and checks. Our office will continue to work with our law enforcement partners to expose and prosecute egregious fraud schemes.”

The case is being handled by the White Plains Division with Assistant U.S. Attorney Nicholas S. Bradley in charge of the prosecution. If convicted, the defendants face a maximum sentence of 20 years in prison for each count.

South Florida Fraud Defense Attorney

Are you accused of committing fraud in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced fraud defense attorneys.

Source: 7.20.20 Former employees of Connecticut insurance firm charged in $17 million fraud scheme.pdf

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