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New York Criminal Law Blog

NICB says insurance fraud allegations on the rise

Commentators believe that the nation’s economic woes, and the consequent unemployment rate, may be linked to a recent rise in suspected cases of insurance fraud. Recently released figures say that 23,402 questionable insurance claims were noted in the state of New York from 2010 through 2012. The data was released by the National Insurance Crime Bureau.

The data places New York near the top as the third highest ranking state for suspected insurance fraud cases during the three year period. New York City ranked number one among cities for suspected insurance fraud with slightly more than 13,500 suspected cases of insurance fraud.

CFPB debt relief referral leads to New York fraud indictment

Four people have been indicted on mail and wire fraud charges related to an alleged conspiracy involving debt consolidation in the aftermath of the financial meltdown, which began in 2008. Prosecutors claim that the owner of a New York company and three employees defrauded consumers nationwide with false promises to consolidate debt. Authorities say that the consumers were not given the relief promised, and some consumers were left worse off due to the alleged fraud.

The case announced last week reportedly is the first to be referred to prosecutors from the Consumer Financial Protection Bureau. We have previously reported white collar investigations involving a number of different federal and state agencies. The CFPB was created in 2010 by the Dodd-Frank Act, and the agency says that it intends to crackdown on consumer fraud issues. The bureau director says that his agency plans to refer more cases for prosecution in the area of the debt consolidation and debt relief industry.

Money laundering indictment handed down in cybercrime ring

Eight people have been charged with cybercrimes based upon allegations that the group hacked into the computer systems of major financial institutions to make unlawful withdrawals of cash. Seven of the eight co-defendants hail from Yonkers, New York and have been detained. The eighth person named in the federal indictment reportedly was murdered in the Dominican Republic last month, according to federal prosecutors in New York.

Authorities claim that the cybercrimes used the Internet to reach money in global financial institutions in a form of 21st century type of bank heist.

Prosecutors are using the cybercrime allegations to bring charges of money laundering and conspiracy offenses, including conspiracy to commit access device fraud. Each of the defendants could face lengthy sentences in federal prison, large fines and restitution if convicted of the charges.

First man sentenced in Manhattan in Dell insider trading case

Two former hedge fund managers were found guilty of insider trading charges late last year. The two are among 73 people who have been convicted since federal officials launched a crackdown on insider trading issues back in August 2009. One of the men was a portfolio manager at Diamondback Capital Management—the other was a co-founder of Level Global Investors. The former portfolio manager was sentenced this week in Manhattan on conspiracy and securities fraud. He was the 48th person to receive sentencing since the crackdown began nearly four years ago.

In sentencing the 48-year-old former fund manager, the judge acknowledged that the defendant was a “decent” man, according to Reuters. The judge also acknowledged that putting the man behind bars would have an adverse impact on the man’s 12-year-old daughter.

The judge sentenced the man Thursday to 4-and-a-half year in prison. The ex-fund manager was fined $1 million and will forfeit more than $730,000 in the sentenced order.

New York lawmakers to consider strengthening public corruption laws

Allegations of political scandal earlier this month in New York has led to a proposed measure aimed at public corruption. Governor Andrew Cuomo announced the proposal, dubbed the Public Trust Act, earlier this month. The idea came after two lawmakers were charged with bribery offenses. The Public Tryst Act reportedly creates at least three new crimes in New York, and also increases potential penalties in criminal public corruption cases.

The three new crimes that the act proposes to create include bribery of a public servant, a government corruption crime, and a provision making the failure to report cases of public corruption a class of crime. The new provisions would add to current public corruption crimes in New York.

New York police officer accused of federal tax fraud

Federal officials claim that a New York cop amassed a list of at least 52 Social Security numbers of kids born in 2007. Investigators claim that the 33-year-old man moonlighted as a tax preparer at the police department without authorization. Authorities claim that the man filed false tax returns for people, using the names and Social Security numbers of children as dependants without the children having any relation to the people named on the tax documents.

The man is now accused of federal tax fraud related to roughly a dozen or so tax returns that included false dependants. Officials claim that the man did not report income that he received from preparing the tax documents, amounting to more than $112,000 of unreported income over three years.

Doctor pleads to $19 million health care and Social Security fraud

A physician who had offices in New York and New Jersey reportedly has pled guilty to conspiracy to commit health care fraud and Social Security fraud charges in what authorities are calling the largest health care fraud case involving a sole practitioner. The doctor appeared in deferral court Wednesday to enter his plea.

Prosecutors claimed that the physician admitted in his plea that he submitted $19 million in fraudulent medical bills for payment from federal and private health care programs. Authorities claim that the doctor conspired to attract patient to his offices in New York and New Jersey and subjected the patients to unnecessary testing and treatment in an effort to obtain health insurance payments.

New York man arrested for alleged $50 million real estate Ponzi scheme

A Far Rockaway, New York man is accused of real estate fraud in an alleged $50 million Ponzi scheme. The Federal Bureau of Investigation claims that the man lured at least five people to invest in real estate in various New York City boroughs, as well as properties located in Atlantic City.

Investigators claim that the Queens man told one of the investors that owners of real estate properties would not close on real estate contracts unless the Far Rockaway man found buyers to purchase the properties from him at a higher price. The FBI claims that the Queens resident told investors that the real estate investments would be risk free, apparently because the deal would never close in the absence of a higher offer.

Business charged in Manhattan with wire, securities fraud over Facebook IPO

Prosecutors in New York charged a Florida man with securities and wire fraud, claiming that the businessman concocted a scheme to personally profit when Facebook initially went public. Authorities accuse the 71-year-old businessman of luring investors into the alleged scheme by fraudulently claiming that he had access to Facebook shares before the initial public offering. The accusations have brought wire and securities fraud charges in Manhattan.

New York officials say that the man pocketed cash from 50 different investors in one scheme. Federal prosecutors claim that the man pocket about $4.6 million from that alleged scheme. In all, authorities say the man defrauded investors out of $8 million in various schemes.

Brooklyn assemblyman faces new mail fraud charges over vouchers

Federal mail fraud charges are a common form of allegations brought by federal prosecutors. Mail fraud is often alleged in white collar crimes, as the federal statute allows for authorities to seek the charge on allegations that someone used the U.S. mail for just about any type of scheme to obtain money through fraudulent means. People from all walks of life may face such allegations due to the apparent breadth of the federal statute. But prosecuotrs must also support the allegations of fraud.

A New York assemblyman from Brooklyn reportedly is facing mail fraud charges based upon allegations that he filed travel vouchers and obtained per diem payments unlawfully. Generally, New York lawmakers who live away from the state Capitol are entitled to receive money to cover travel expenses, food and lodging if they travel to the Albany on official business. Authorities claim that the Brooklyn assemblyman submitted fraudulent travel vouchers and received per diem pay for a trip to Albany that officials say never occurred.

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