Ten Indicted In Queens Insurance Fraud Ring
Attorney General Spitzer and State Insurance Superintendent Gregory Serio today announced the indictment of 10 people and five corporations on charges relating to the submission of fraudulent no-fault claims to an insurance carrier. The defendants, nine of whom are health care providers, are accused of operating an insurance fraud conspiracy out of SZ Medical, a clinic in Hollis, Queens.
The charges stem from a long-term investigation of SZ Medical which began in the Spring of 2003. It is alleged that the defendants submitted fraudulent claims to a no-fault insurance carrier for services never provided or for services that were not medically necessary. Under the State's no-fault law, insurance carriers reimburse medical facilities for services provided to persons injured in motor vehicle accidents.
"This case demonstrates the sustained and coordinated effort required to combat the pervasive nature of auto insurance fraud," Spitzer said. "My office will continue to work with the State Insurance Department, law enforcement, and industry officials to bring these cases. While we are making progress, there is still an extraordinary amount of work yet to do."
Gregory V. Serio, Superintendent of Insurance, said, "It's particularly disturbing that this fraud ring was comprised of doctors and health care providers, professionals who are here to protect us and not betray the public's trust by defrauding our insurance system. Thanks to our strong partnership with Attorney General Spitzer, these people have been exposed and this case will help us build more momentum in the fight against fraud."
According to the indictment, the defendants fraudulently billed an insurance carrier for months of treatment and extensive testing, including medical evaluations, diagnostics tests, physical therapy, chiropractic treatment and acupuncture.
The indictment charges that fraudulent claims were submitted by three medical doctors, Sergey Zavilyansky, 48, of Brooklyn; Gary Friedman, 51, of Manhattan; and Lee Craig Nagourney, 52, of Brooklyn. Zavilyansky is the owner of SZ Medical. All three are charged with fabricating medical diagnoses and submitting claims for services not provided or not medically warranted.
The indictment additionally charges the following defendants with fraudulent claim submissions: Stanley Frankel, 69, of Manhattan, a dentist; Michael Ferrato, 56, of Suffolk County, a psychologist; Juby Uralil, 26, of Queens County, a physical therapist; Joel Santos, 34, of Queens County, a physical therapist; Peter Pramberger, 51, of Suffolk County, a chiropractor; and Ji Yong Kim, 39, of New Jersey, an acupuncturist.
The indictment also charges that defendant Nelson Bloom, 57, of Brooklyn, a paralegal, held himself out as a licensed attorney and directed a no-fault patient to undergo medical tests and attend the clinic for several months, without regard to medical need, in an effort to increase the potential settlement of a bodily injury claim.
Five corporations are also charged in the indictment: SZ Medical, P.C.; Almaz Medical Services, P.C., owned by physician-defendant Lee Craig Nagourney; Ferrato Psychological Services, P.C., owned by psychologist-defendant Michael Ferrato; Life Chiropractic P.C., owned by chiropractor-defendant Peter Pramberger; and Somun Acupuncture, P.C., owned by acupuncturist-defendant Ji Yong Kim.
The defendants are facing charges of Insurance Fraud in the Third Degree, a D felony; Insurance Fraud in the Fourth Degree, an E felony; Falsifying Business Records in the First Degree, an E felony; Insurance Fraud in the Fifth Degree, an A misdemeanor, Attempted Grand Larceny in the Fourth Degree, an A misdemeanor; Practicing or Appearing as an Attorney-At-Law Without Being Admitted and Registered, an A misdemeanor; Conspiracy to Commit Grand Larceny in the Fourth Degree, an A misdemeanor; and Attempted Petit Larceny, a B misdemeanor.
The charges in the indictment are merely accusations and the defendants are presumed innocent until and unless proven guilty.
The case is being prosecuted by Assistant Attorney General Damian Sean Jackson of the Auto Insurance Fraud Unit, under the supervision of Unit Chief Steve Nachman. The investigation was conducted by Investigators Michael Beshara, Osaretin Omoigui and Daniel Pisculli, Auditor Dmitry Temis, and Analyst Heather Brown, under the supervision of Supervising Investigator Dominick Zarrella and Deputy Chief James Conway of the Attorney General's Investigations Bureau.