Lynn Woman Indicted Twice for Welfare Fraud.
In August 2021, a Lynn woman was indicted in the Essex County Superior Court in Salem on one count of larceny over $1,200 and 31 counts of uttering a false writing. The indictments allege that over a period of approximately 10 years, the woman stole childcare benefits and SNAP benefits by providing false information to EEC. The indictments allege that the woman concealed the fact that she resided in an intact family with her spouse, the father of her children, who was gainfully employed. In addition, it is alleged that the woman provided false information to EEC and failed to accurately report her own income to appear eligible for benefits; she is alleged to have altered and/or forged income information on paystubs submitted to EEC. As a result, she allegedly stole approximately $254,074.57 in childcare benefits from August 2011 through September 2021. On August 24, 2021, the woman pleaded not guilty at arraignment. In April 2022, 12 of the uttering charges were dismissed following a non-evidentiary hearing to dismiss. This case remains pending in Essex Superior Court.
On June 1, 2023, the woman was again indicted in the Essex County Superior Court, this time on one count of larceny over $1,200, one count of receiving or embezzling stolen transitional assistance funds, two counts of uttering a false check, and three counts of public assistance fraud. The new indictments alleged that over a two-year period, the woman stole SNAP benefits by providing false information to DTA. The woman allegedly failed to accurately disclose her wages from employment as a PCA, provided false information to DTA, failed to accurately report her household’s income to appear eligible for benefits, and altered and/or forged income information on paystubs submitted to DTA. As a result, she allegedly stole approximately $24,331 in SNAP benefits from May 2020 through April 2022. On June 14, 2023, the woman pleaded not guilty at arraignment. This case also remains pending in Essex Superior Court.
Quincy Woman Sentenced for Filing False Claims and Probation Violations.
On July 14, 2022, a Quincy woman who owned and operated a counseling practice located in Quincy, pleaded guilty in Norfolk County Superior Court to two counts of Medicaid fraud, two counts of larceny under $250, and one count of private health insurance fraud. She was indicted on these counts in November 2021. Between 2016 and 2021, the woman allegedly billed for services that were either not performed or not rendered by a licensed practice member and submitted false claims to MassHealth and private insurance with incorrect service/treating provider information. Upon reviewing the woman’s bank accounts, it was determined that she used the money for personal expenses.
Shortly after her indictments in November 2021, the woman was indicted again, in Norfolk County Superior Court in December 2021. Charged with one count of larceny over $1,200 and one count of filing a false healthcare claim, these indictments also related to her ownership and operation of her counseling practice. The false claims at issue, however, only involved Medicare, as the indictments alleged that the woman billed Medicare for services that were either not performed or not rendered by a licensed practice member. Similar to the previous indictments, the woman allegedly used the money acquired through this alleged fraud on the same kinds of personal expenses. She pleaded guilty to both of these counts on July 14, 2022, as part of a change of plea agreement.
At the time of indictment in November 2021 and December 2021, the woman was already on probation from two previous criminal cases, filed in 2015 and 2018 in Norfolk County Superior Court, respectively. In those cases, she was indicted for, and pleaded guilty to, larceny, public assistance fraud, uttering, and forgery in November 2020 for failing to accurately report her household income to EEC and DTA. The woman was sentenced to five years of probation, with the first year to be served with a GPS monitor and in-home confinement, with exceptions for work. As part of her probation, the woman was prohibited from any further criminal charges. The new 2021 indictments alleged that the provider fraud occurred before and after the change of pleas in both of these cases, in direct violation of her probation.
Following her change of plea to guilty, the woman was sentenced for the 2021 indictments, as well as the probation violations, on August 2, 2022. Her sentence ordered incarceration for three years, with credit for time served (255 days), probation for three years, and restitution totaling $532,522.83 at $150 per month repayment set to begin three months following her release. She was also excluded from the MassHealth program; she is prohibited from employment as a MassHealth provider or with another MassHealth provider and billing MassHealth for services rendered.
Framingham Woman Sentenced for Welfare Fraud.
On October 3, 2022, a Framingham woman was sentenced by US District Court Judge Nathaniel M. Gorton to time served (approximately one day) and three years of supervised release, with the first 15 months to be served in home confinement. She also received an order to pay restitution totaling $253,199.57 to the benefit agencies she defrauded. In March 2022, the woman pleaded guilty to four counts of the theft of public funds and two counts of making false statements. Over approximately 12 years, the woman allegedly stole $68,223 in Social Security benefits, $1,908 in MassHealth benefits, $21,790 in SNAP benefits, and $161,277 in Section 8 housing assistance by falsely claiming she lived alone when, in fact, she was living with her husband. Allegedly, she falsely informed the Social Security Administration about her household composition in June 2016, and she did the same with the Marlborough Community Development Authority in May 2017.
Marston Mills Woman Indicted for Childcare and Welfare Fraud.
On May 24, 2023, a Marston Mills woman was indicted for allegedly receiving childcare and DTA benefits fraudulently. The woman faces one count of larceny and four counts of theft of public funds. The indictment alleges that between 2015 and 2020, the woman failed to report her spouse, the father of her children, as a part of her household and that she failed to report his income. As a result, his income was not counted when the benefits programs determined her eligibility and it is alleged she stole approximately $110,890.99 in EEC benefits from June 2015 through November 2020, $29,177 in SNAP benefits from January 2015 through January 2019, and $3,927.55 in TAFDC benefits from May 2018 through August 2018. This case is currently pending in Barnstable County Superior Court.
BSI Participation in Document and Benefit Fraud Task Force Sustained.
BSI received 48 referrals in FY23 as an active member of the US Attorney’s Public Assistance Fraud Task Force. BSI also continued to serve on the Homeland Security Investigation’s Document and Benefit Fraud Task Force (DBFTF), which comprises various local, state, and federal agencies with expertise in detecting, deterring, and disrupting organizations and individuals involved in various types of document, identity, and benefit fraud schemes.
DBFTF’s “Double Trouble” investigation continued to identify suspects who allegedly obtained stolen identities of US citizens living in Puerto Rico and then used those identities to obtain documents and public benefits that they would not otherwise be eligible to receive. Most frequently, these benefits included Registry of Motor Vehicles identity documents, Social Security numbers, Medicaid, unemployment compensation, and public housing subsidies. During FY23, this task force expanded its investigations to include other public benefits programs. Also during FY23, one defendant was sentenced in a Double Trouble case.
On March 22, 2022, a resident of the Dominican Republic, previously residing in Lawrence, pleaded guilty to one count of false representation of a Social Security number. When applying for a Massachusetts driver’s license, he presented the name, Social Security number, and date of birth of a US citizen from Puerto Rico. In addition, he received approximately $6,117 in unemployment insurance benefits in the name of the stolen identity. During the investigation, Social Security records revealed that the victim, whose identity was stolen, resided in Puerto Rico and had never been to Massachusetts, let alone applied for benefits in Massachusetts. Charged with one count of false representation of a Social Security number and one count of identity theft, he was arrested as part of a sweep conducted in December 2018. (https://www.justice.gov/usao-ma/pr/six-arrested-lawrence-identify-theft-and-social-security-fraud)
On September 21, 2022, US District Court Judge Richard G. Stearns sentenced the individual to one year and a day in prison and two years of supervised release. He was ordered to pay $100 in restitution and will be subject to deportation upon the completion of his sentence.
BSI Affirmative Litigation.
In January 2022, BSI pursued affirmative litigation following Middlesex Savings Bank’s (MSB’s) refusal to comply with an information request BSI initiated in accordance with Section 17(10) and (12) of Chapter 11 of the Massachusetts General Laws. In an effort to determine whether accurate income and asset information was provided to the public benefits program for the subject of one of BSI’s investigations, the investigating examiner issued an information request to MSB for bank statements and other materials from the subject’s known accounts. MSB refused to comply with the request and declined to provide the subject’s bank records without a signed release or subpoena.
Represented by counsel from AGO, BSI initiated an administrative civil action. BSI maintained that its “power to examine financial records under G.L. c. 11, § 17(10) necessarily encompasses the power to retrieve, retain, and disseminate copies of those records for purposes authorized by G.L. c. 11, § 17, and the Auditor’s rules and regulations. G.L. c. 11, § 12; G.L. c. 11, § 16; 965 CMR § 2.00 (Fair Information Practices Act).” (Commonwealth of Massachusetts v. Middlesex Savings Bank, (2023)). In its reply to BSI’s complaint, MSB asked the court to dismiss BSI’s complaint or in the alternative order MSB’s compliance with BSI’s information request. MSB maintained that BSI’s request was not a duly authorized summons or subpoena, that BSI lacked statutory authority to issue a summons or subpoena to produce records, and that compliance with BSI’s request, absent a duly authorized summons or subpoena, conflicted with MSB’s privacy obligations to its client(s).
MSB’s lack of compliance stemmed from their contention that it was “not obligated to obey BSI demands for financial (records) under §§17(10), (12) absent a judicial order under G.L. c. 214, §§3(12)-(13).” In support of its position, MSB argued that BSI’s statutory authority did not identify BSI’s written request as a summons or subpoena, that a bill proposed by the Auditor in 2015 was indicative of BSI’s inability to self-enforce compliance with its requests, and that a court judgment was necessary to enforce MSB’s compliance within a reasonable time. The crux of MSB’s opposition, however, rested on its dispute of BSI’s information request constituting a self-enforcing order, given that it was a “written request” and BSI’s authorizing statute did not use terms like “order,” “summons,” or “subpoena.” Commonwealth of Massachusetts v. Middlesex Savings Bank, (2023).
BSI maintained that its information request was a lawful directive that MSB was “explicitly mandated to comply with,” that the request’s lack of self-enforcement did not negate MSB’s obligation to comply, and that MSB’s compliance was not precluded by any privacy obligations. Commonwealth of Massachusetts v. Middlesex Savings Bank, (2023).
In January 2023, Superior Court Judge Robert B. Gordon ordered MSB to produce all responsive documents to BSI within five days and to refrain from disclosing the terms of the order to the subject until at least two days after the records’ production was completed. Justice Gordon found that the lack of self-enforcement within BSI’s authorizing statute was immaterial and did not erode its legal force altogether. He held, “The fact remains that the BSI, acting within the scope of its express authority to request and review records deemed relevant to a public fraud investigation, issued an order that the Bank (MSB) produce financial records of the Subject that are within the Bank’s possession.” Commonwealth of Massachusetts v. Middlesex Savings Bank, (2023). MSB did not appeal this order and produced the requested financial records in February 2023.
This litigation was the first judicial affirmation of BSI’s investigatory authority under Section 17 of Chapter 11 of the General Laws.
|
While the bulk of cases BSI investigates are referred from state agencies and law enforcement, the general public also plays a vital role in reporting fraud. The State Auditor’s Office has an online form to report public assistance fraud: http://www.mass.gov/forms/report-public-benefit-fraud-online. Citizens can also use BSI’s fraud reporting hotline: (617) 727–6771. All complaints are kept confidential. |
| Date published: | December 27, 2023 |
|---|