Over Thirty Charged in Scheme to Bilk Insurance Companies of $12M Westchester County District Attorney Jeanine Pirro was joined by New York State Police Major Frank Koehler, Yonkers Police Commissioner Robert Taggart, Westchester County Police Commissioner Thomas Belfiore, New York City Police Department Deputy Inspector Alan Cooper, New York State Insurance Frauds Bureau Director Charles Bardong, the National Insurance Crime Bureau, the New Jersey Attorney General’s Office and numerous insurance carriers to announce the results of a three-year investigation into the systematic fraudulent billing of no-fault accident claims by a major medical mill operating in Westchester County. It is alleged that Elm Street Medical, PC operating out of One Elm Street, Tuckahoe, New York, bilked insurance companies by exploiting the no-fault provisions of the New York State Comprehensive Motor Vehicle Insurance Reparations Act. (This act entitles persons injured in automobile accidents to a minimum of $50,000 of medical coverage regardless of who is at fault.) Over a period of approximately three years, Elm Street Medical bilked dozens of insurance companies by upcoding (i.e. the submission of claims containing codes for expensive medical services never provided) or by submitting bogus claims for medical services on behalf of patients who had not been in a car accident. Elm Street’s physicians would routinely recommend numerous tests or treatments including physical therapy treatment; chiropractic services; dental evaluations, testing and treatment; orthopedic evaluations; psychiatric evaluations and treatment; psychological evaluations and treatment; neurological evaluations and testing; durable medical goods; and excessive diagnostic testing all provided for at the Elm Street facility. Some of the procedures that were billed for were never performed and others were shams. Additionally, a simple five minute procedure would be routinely upcoded and billed for a more complicated and longer higher reimbursement procedure. All of the patients were required to assign all insurance payments to Elm Street. Patients also received a promise of proceeds from any potential lawsuit as a result of their injuries. In order to further the operation, LEONARDO VELEZ, an emergency room employee at Saint Joseph’s Hospital in Yonkers and BARRY SUAREZ, a paramedic employed at Empress Ambulance Service, forwarded confidential patient information about individuals involved in accidents from numerous Westchester County hospitals to co-defendant BRUCE NIXON. Nixon, posing as a doctor or hospital patient care coordinator, would refer these patients, most of whom were in minor fender bender accidents, for unnecessary follow-up medical treatment at Elm Street. Nixon would make approximately $1,500 for each referral. Another defendant, JEAN RICHARDSON, actively participated in this criminal enterprise by setting up fictitious accidents. It is alleged that Richardson, while a shelter director at Westhab, Inc., a non-profit organization that administers the daily operation of Westchester County’s homeless shelter system, used Westhab employees and residents to pose as injured car accident victims for the purpose of creating false insurance claims. Not only did uninjured Westhab residents and employees pose as injured patients, but they were also shuttled to the Elm Street offices in official Westhab vans. Richardson is no longer employed by Westhab, Inc. The Elm Street Enterprise, through its office managers, ALEXANDER KARSHENBOYM and SERGEY CHIZHOV, paid runners (recruiters), including, BRUCE NATHANIEL NIXON, JEAN RICHARDSON and others, to steer claimants to medical clinics owned and operated by the Elm Street Enterprise. The runners paid BARRY SUAREZ and LEONARDO VELEZ, and others to steal confidential patient information to permit the runners to contact the patients and turn them into claimants at the medical clinics owned by the Elm Street Enterprise. Many of these claimants had been in real, but minor automobile accidents. Others, such as ROBERT WECHSELBLATT and runner JEAN RICHARDSON, were not in automobile accidents, but knowingly permitted their names and pedigree information to be placed on fictitious accident reports and thereafter told insurance carriers and others that they had been involved in actual automobile accidents. In order to legitimatize the false insurance claims submitted by the Elm Street enterprise, it is alleged that SHARON DAVIS, a former New York City Police Department Administrative Aide, and LORETTA STOKES, a former New York City Police Department Administrative Aide, assisted in the creation of forged police accident reports by knowingly entering false data about fictitious accidents into the New York City Police Department database, so that an accident report number could be assigned. These defendants received up to $300 per report for their criminal activity. They are charged with Criminal Facilitation in the Fourth Degree. The enterprise also included corrupt medical professionals and staff employed by the Elm Street Enterprise, including VLAD MEISHER, MD; JOHN GELFAND, MD; YEFIM SOSONKIN, MD; TOBIAS SHKLOVER, MD; HERBERT FENTON, DDS and others, purportedly rendering and providing medical treatment to these claimants and creating reports documenting the services they purportedly provided. The fraudulent reports and claims submitted to insurance carriers detailed fictitious, unnecessary and/or underperformed medical visits and procedures as well as treatment contrary to generally accepted medical practice. On June 23, 2004, the Westchester County District Attorney’s Office, the New York State Police, and the New York State Insurance Frauds Bureau executed three search warrants resulting in the seizure of hundreds of patient files from the Elm Street Medical offices. It is believed that the Elm Street operatives received over $12 million dollars during a five year period from 1999 to 2004 as a result of running this criminal enterprise. Of the 34 charged, fourteen (14) individuals and six (6) corporations were indicted. All twenty (20) indicted defendants were part of the Elm Street enterprise operating to defraud insurance carriers through the submission of fraudulent no-fault automobile claims. Those indicted were ALEXANDER KARSHENBOYM; SERGEY CHIZHOV; ELLA CHIZHOV; VLAD MEISHER, MD; JOHN GELFAND, MD; TOBIAS SHKLOVER, MD; YEFIM SOSONKIN, MD; HERBERT FENTON, DDS; BRUCE NATHANIEL NIXON; BARRY SUAREZ; LEONARDO VELEZ; JEAN RICHARDSON and ROBERT WECHSELBLATT. One indicted individual remains at large. Corporate summons were also issued for six corporations owned and operated by the enterprise; ELM STREET MEDICAL, PC; ELM NEUROLOGICAL CARE, PC; COMPAS MEDICAL, PC; BOGART AVENUE MEDICAL, PC; ANDA MANAGEMENT CORPORATION; and ALL-SHURE CORPORATION. Moreover, the following 14 individuals were arrested and charged by felony complaint: ANDREW CHEVANNES, ALLAN BAILEY, SHEENA GRAVES, KEVIN GOEFF, GISELLE RIVAS, ROSE ORTIZ, VINCENT JENKINS, LEON AKERY, SHARON CLARK, ANDRE CABAN, KEN COLEMAN, DENISE AHMAD, IBRAHIM AHMAD and PATRICIA TERRY. The investigation is continuing. Among the crimes charged against defendants are Enterprise Corruption, Insurance Fraud in the First Degree and Money Laundering in the First Degree, all class “B” felonies, as well as Insurance Fraud in the Second Degree and Grand Larceny in the Second Degree, class “C” felonies. If convicted, those defendants charged with class “B” felonies face a maximum of twenty-five years in state prison. District Attorney Jeanine Pirro thanked the following insurance companies for their investigative assistance: Allstate, GEICO, Liberty Mutual, Nationwide, Countrywide, State Farm, Progressive, One Beacon and AutoOne. DA Pirro also thanked Lawrence Hospital, the Westchester Medical Center, Saint Joseph’s Hospital, Saint John’s Riverside Hospital, Mount Vernon Hospital, Sound Shore Hospital, Empress Ambulance Service and the NYPD Fraudulent Accident Investigation Unit. DA Pirro also thanked the New York State Motor Vehicle and Insurance Fraud Prevention Board for their assistance. -END – In compliance with Disciplinary Rule 7-107A of the Code of Professional Responsibility, you are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
