Business

Doctors, Former Union Prez Arrested in $1 Billion Disability Scheme

Arrests Made in $1 Billion Disability Scheme

Joseph Rutigliano, a former L.I.R.R. conductor, playing golf in 2008. Mr. Rutigliano retired in 1999 after a year in which he worked over 500 hours of overtime and took no sick leave, according to the complaint. He then applied for and received disability benefits upon his retirement (Image: New York Times)

Eleven people, including two doctors and a former union president, were charged on Thursday in a “massive fraud scheme” in which hundreds of Long Island Rail Road (L.I.R.R.) workers made false disability pension claims that could have cost a federal pension agency about $1 billion, according to court papers and the New York Times.

Seven former railroad employees, the former union president, a former federal railroad pension agency employee, and one of the doctors (all accused of being co-conspirators) were arrested Thursday morning by F.B.I. agents and New York state investigators

There is another doctor involved who is reportedly expected to surrender soon.

They have been charged with mail fraud and conspiracy to commit health care fraud, according to a criminal complaint filed in the case.

The federal investigation was the result of sharp-eyed reports published by The New York Times in 2008 that “revealed systematic abuses of Railroad Retirement Board pensions by Long Island Rail Road workers.”

Allegedly, almost every career employee of the railroad was applying for and receiving disability payments, giving the L.I.R.R. a disability rate of three to four times that of the average railroad, reports the Times.

It was also discovered by the Times that retired railroad employees who had successfully claimed disability were regularly playing golf at a state-owned course without charge—a perquisite of their disability.

But that’s nothing. Apparently, they weren’t even trying to hide the fact that they all led healthy, disability-free lifestyles.

For instance, one former rail worker claimed he was unable to do any physical labor because of “severe and disabling pain in [the] back, shoulder & legs,” but completed a 400-mile bike tour in northern New York in 2009, writes the Wall Street Journal.

But that’s not all.

The New York Times reports:

One of the defendants, Gregory Noone, who receives $105,000 in pension and disability payments each year, plays tennis several times a week and played golf more than 100 times in less than a year despite supposedly suffering severe pain when gripping objects with his hands, bending or crouching, the complaint said.

Another defendant, Regina Walsh, an office worker for the railroad, who collects $108,000 a year in pension and disability payments and complained of significant neck, shoulder, hand and leg pain when standing for more than five minutes, was seen under surveillance shoveling heavy snow and walking with a stroller for a long period of time, the complaint said [emphases added].

And the Journal reports that one of the conspirators, Mr. Rutigliano, the former union president, worked more than 500 hours overtime in the year before he retired and took no sick leave, yet applied for disability benefits.

But why would the doctors go in on the scheme?

Allegedly, the doctors would charge around $800 to $1,200 in fees from each patient in return for prescribing unnecessary medical tests and physical therapy. The investigators then claim that the doctors would fabricate or grossly exaggerate medical assessments and built illness narratives to show the employees were unable to work.

By doing this, the doctors were able to collect millions of dollars in corrupt payments from patients and insurance companies, according to the 74-page complaint in the case.

“And based my analysis of the data, including but not limited to the percentage of L.I.R.R. applicants handled by the three doctors discussed in this complaint and actual disability payouts to date, I further estimate that the fraudulent scheme could cause the R.R.B. to pay unwarranted occupational disability benefits exceeding $1 billion dollars if disbursed in full [emphasis added],” the complaint said.

Read the full report here.

Comments (54)

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  • obamabirthcertificate.net
    Posted on October 27, 2011 at 9:08pm

    God help America.

    How to quickly understand eligibility.
    http://www.ObamaBirthCertificate.net

    Report Post » obamabirthcertificate.net  
    • Shiroi Raion
      Posted on October 28, 2011 at 7:10am

      Hopefully, Bernie Madoff has some new bunk buddies.
      Wanna fix the country?
      Have the Progressive cronies all share Madoff’s new home.
      Plenty of space for Frank, Dodd, Sharpton…

      Just tell them it‘s their Socialist Utopia succeeded and they won’t have to work ever again. Free food, free housing, free everything…
      They won’t have to work ever again. That’s what Liberals want, right?

      Report Post » Shiroi Raion  
  • I.Gaspar
    Posted on October 27, 2011 at 8:56pm

    I say lay them across the tracks right before an express train comes through the station.
    THEN pay them their disabilty.

    Report Post »  
  • TouchStoneMT
    Posted on October 27, 2011 at 8:43pm

    A “union pension scam”?!?!?

    ….channeling Inspector Renault:
    “I’m shocked! SHOCKED, I tell you…….”

    Report Post » TouchStoneMT  
  • ((GB)) FAN
    Posted on October 27, 2011 at 8:42pm

    this is a mosquito bite of what is going on. we need to ask our selves will we elect someone to fix the problems?

    Report Post » ((GB)) FAN  
  • right
    Posted on October 27, 2011 at 8:27pm

    This makes me sick.

    Report Post »  
  • jessieH
    Posted on October 27, 2011 at 7:30pm

    It’s a start. Once WE take our country back from the corrupt, I expect there will be more. A lot more.

    Report Post »  
    • seldomscene
      Posted on October 27, 2011 at 7:40pm

      I meant NY Times not Washington Times! Again, touche on the minimum 2 years in jail. Good enough for our border agents, huh?

      Report Post » seldomscene  
  • FNTM
    Posted on October 27, 2011 at 7:00pm

    Their wives are going to be some kind of pissed a them if everything is taken from them! LMAO!

    Report Post » FNTM  
  • Kathleen3
    Posted on October 27, 2011 at 6:49pm

    Every single criminal union member and the doctors should be forced to “do the jobs Americans don’t want to do” until such time as they reimburse every cent illegally taken, and then a judge should add on an additional year.

    What is really sad is the fact other union members refuse to accept the fact they are paying for their corrupt and greedy former co-workers fraud.

    Report Post »  
    • georgiavietvet
      Posted on October 27, 2011 at 7:32pm

      kathleen3……………. right on make them work. the damn bums and thugs.

      Report Post »  
  • buster2
    Posted on October 27, 2011 at 6:31pm

    Look for the union label. Kinda like the people retiring after teaching one day as a special perk of the teachers union. That is why we need ACORN and all the other community leaders to help us get ahead. Unless DOJ intervenes, maybe these guys will go to jail>>>>>

    Report Post »  
    • loriann12
      Posted on October 27, 2011 at 7:09pm

      And yet our military has something called mandatory time in service or time in rate…you have to have so many years in service and/or rate to be advanced to the next level.

      Report Post »  
  • geonj
    Posted on October 27, 2011 at 6:25pm

    why weren’t these people checked out by doctors working for disability to verify the disabilities? this is required for anyone who has to apply for social security disability.

    Report Post » geonj  
    • RetUSAFVet
      Posted on October 27, 2011 at 8:30pm

      You misunderstand. These are UNION workers. They, like congress, are above the laws you and I must abide by. It only proves that the two most corrupt groups in America are the unions and the congress. Let’s start correcting the problem by voting out any congressman/senator who has been in for more than two terms. Let’s start our own term limits.

      Report Post » RetUSAFVet  
    • tvr54
      Posted on October 28, 2011 at 7:30am

      If SSD finds you disabled then you can apply for the union disablity funds, all of the payments are based on SS system. I personelly believe the whole system is twisted all around.
      My case is a little different i have broken my neck from over lifting heavy items for many years, I returned to work for another 10 years then the surgery that was performed failed, At my yearly check up the doctors told me i had Hep- C, so off to Cemo we go now.
      At 6 months the treatment caused me to have a heart attack i was deemed incureable, and kicked to the curb, between the railroad and SSD i recieve a whole $1400 a month not getting rich there, so please tell me how in the h@ll do these people recieve so much in retirement i worked 30 years?
      Go figure

      Report Post » tvr54  
  • M 4 Colt
    Posted on October 27, 2011 at 6:21pm

    Gee, what do you want to bet, they are all democrats

    Report Post »  
    • motonutt
      Posted on October 27, 2011 at 6:32pm

      They did what they did and now they got caught. Now….we can hope that justice will be served.
      They should be fined for every penny they have and then some, and put in jail.

      Report Post » motonutt  
  • Dug2Dark
    Posted on October 27, 2011 at 6:11pm

    Wow, talk about being railroaded.

    Report Post » Dug2Dark  
    • pavepaws
      Posted on October 27, 2011 at 6:24pm

      All payments should be reimbursed by the defendants if found guilty, and all defendants should lose all pension benefits. If civil charges can be applied, then lawsuits against the defendants should be used.

      Report Post »  
  • Hickory
    Posted on October 27, 2011 at 6:10pm

    Beware the union label.

    Report Post » Hickory  
  • spk2moi
    Posted on October 27, 2011 at 6:08pm

    Union thugs, unite!

    Report Post »  
  • South Philly Boy
    Posted on October 27, 2011 at 6:04pm

    Just think if the Feds ran the whole show

    Report Post » South Philly Boy  
  • tnturner
    Posted on October 27, 2011 at 5:35pm

    What the heck is R.R. B.?

    Report Post » tnturner  
  • garbagecanlogic
    Posted on October 27, 2011 at 5:35pm

    Screw them to the max, take everything they own and give it to the poor. Union thugs and leeches, they would screw their own mother if there was a dollar in it.

    The U.S. Out Of The U.N.
    The U.N. Out Of The U.S.

    Report Post »  
  • Fina Biscotti
    Posted on October 27, 2011 at 5:27pm

    UNIONS are nothing but Organized Crime Syndicates.

    Report Post »  
    • Shrugged
      Posted on October 27, 2011 at 5:51pm

      And now – so are most of our government officials

      Report Post »  
  • BillyPenn
    Posted on October 27, 2011 at 5:22pm

    While reading just the headline of this article, my first thought was Chicago. Surprise, surprise !

    Go on disability and golf for free !! Not sure if that makes any sense, but then, unions are unions.

    Seems as if years ago I made a poor career choice, should have gone with the railroad when I had the chance. Great pension, free travel pass and free golf, what else could a guy ask for ?

    Report Post »  
  • LetUsReason
    Posted on October 27, 2011 at 5:22pm

    In the words of Stewie from Family Guy: “There is treachery afoot!” But seriously, I’m sick of corruption! I say give them all the death penalty.

    Report Post »  
  • charles dagwood
    Posted on October 27, 2011 at 4:59pm

    these investigators had better be careful. they might get accused of “rough cuffing” and get thrown into a federal prison for a couple of years.

    Report Post » charles dagwood  
  • Ohio Girl
    Posted on October 27, 2011 at 4:58pm

    Since the government is so into changing the Health Care. Maybe instead of starting a whole nother system with Millions/Billions of dollars of start up. Look into the old system that would work if crooks like these get taken care of. GET OUR MONEY BACK!! I say let us shop around for our own health care like care insurance. Open it up the regulations that don’t let us go to other states for health care. Once there is competition you will get better rates and insurance that fits the family.

    Report Post »  
  • commonsenseguy
    Posted on October 27, 2011 at 4:54pm

    they will never be prosecuted,holder will let them off,this is a scam that has been around for years, if they { the state }really wanted to put a end to this crap, they would have along time ago,now that the fbi,is involved, it will be brought on in federal court,but none of them will do jail time, and they will never be able to pay back any of the money, because holder or some liberal union lawyer will find away to work the system so they can keep collecting their disability payments,and if by the off chance they must sacrifice a sheep { low level person } they will never be able to pay back any of the money, but that will never happen, they will never be prosecuted, and just think obama wants all government employees to be union, want that be great,not only will they be able to scam and rip off the taxpayers,but they will be able to do legally,and you know when they start rioting like over in greece,the will have reason to claim disability,want it great !!!

    Report Post »  
  • Robert-CA
    Posted on October 27, 2011 at 4:36pm

    Finally somebody is investigating a $60 billion medical fraud per year .

    Report Post » Robert-CA  
  • drago
    Posted on October 27, 2011 at 4:33pm

    What, doctors and a union prez commiting fraud? Nah………..

    Report Post »  
    • Skrewedretiree
      Posted on October 27, 2011 at 4:45pm

      OMG! Say it isn’t so….!

      Report Post » Skrewedretiree  
    • db321
      Posted on October 27, 2011 at 4:53pm

      No What Are You Doing – We do want to catch people defrauding our Government we would rather push the old ladies off the cliff – the crocks need an income too!

      Ronald Reagan cut Fed Budget of SS by half while still increasing SS recipients benefits – CUT THE WAST NOW – stop the games and cut the waste.

      Report Post » db321  
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