Almost all of the former cops and firefighters were already collecting pensions.
The applicants claimed that they suffered a psychiatric condition that prevented them from working, such as post-traumatic stress disorder, anxiety, or depression. Many of the defendants used their association with the events of September 11, 2001, as the cause of their psychiatric condition. Seventy-two of the defendants are also collecting pensions as retirees of the NYPD, eight from the New York City Fire Department, five from the New York Department of Correction, and one from the Nassau County Police Department.
The men did not need to be completely disabled to receive pensions, but they did to be eligible for social security.
For that reason, according to the charges, to overcome the SSDI threshold, the applicants, with the help and direction of ESPOSITO, HALE, MINERVA and LAVALLEE, created false psychiatric conditions, typically depression, anxiety, or post-traumatic stress disorder (“PTSD”).
.... Specifically, they instructed applicants on how to fail memory tests with plausibility, how to dress, and on their demeanor. Almost every application included identical descriptions of the applicants’ activities of daily living.
But they weren't disabled according to their personal FB pages:
For example, defendants often claimed that they rarely left their homes, did not travel, and had almost no social interactions with family and friends. But, according to court documents, applicants were in fact driving, traveling by air, engaging in recreational sports, and lifting heavy objects. Several of the defendants also were gainfully employed, including at energy and investment companies, private security and private eye firms, construction and landscaping, and even baking.
One rode a jet ski, another taught and performed mixed martial arts, and another piloted planes.
Then there's the kickbacks:
ccording to the indictment, after the retroactive awards were deposited into the applicants’ accounts, ESPOSITO and MINERVA instructed the applicants to withdraw cash from the bank in in increments under $10,000, so that the withdrawals would not raise suspicion or require the filing of currency reports with the federal government. Applicants then made cash payments to ESPOSITO or MINERVA, who in turn transferred the money to HALE and LAVALLEE. These one-time cash payments were based on the applicants’ monthly awards, and ranged from approximately $20,000 to $50,000.
In addition to a portion of the secret kickbacks, LAVALLEE also received $6,000 directly from the government for attorney’s fees for each applicant. Applicants then continue to collect their monthly fraudulent disability payments, which ranged from approximately $2,000 to $5,000 per month, depending on the number of dependents within the beneficiary’s household.
Who were the ringleaders: From the DA's press release:
The four principal defendants, RAYMOND LAVALLEE, 83, THOMAS HALE, 89, JOSEPH ESPOSITO, 64, and JOHN MINERVA, 61, are accused of directing hundreds of SSDI applicants, including many retirees of the NYPD and FDNY, to lie about their psychiatric conditions in order to obtain benefits to which they were not entitled. They are charged with Grand Larceny in the First and Second Degrees, and Attempted Grand Larceny in the Second Degree. The remaining 102 defendants, all SSDI recipients, are charged with Grand Larceny in the Second Degree and Attempted Grand Larceny in the Second Degree.
The average payout amount was $210,000, with some reaching $500,000, for a total of more than $20 million.
The New York Times reports:
The inquiry started in 2008 when Social Security investigators noticed that two retired police officers who had gun permits were also receiving payments for a mental disability. That discovery led to a review of other applications handled by Mr. Lavallee and a multiagency investigation.
The four leaders were granted bail today.
Mr. Lavallee and Mr. Hale were each released on $1 million bail, while Mr. Esposito posted $500,000 and Mr. Minerva put up $250,000.
These defendants are just a part of the overall scheme, which the state alleges began in 1988, involved more than 1,000 people who "were suspected to have bilked the federal government out of an estimated $400 million."
The New York Times, by the way, has had a major site overall. As of now, there are 1,146 comments on the story.
