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Eleven people were charged by the United States government with actively participating in a $1 billion scam that falsely claimed disability benefits for retired New York commuter railway workers.
The charged individuals included two doctors and a former president of a union. The physicians recommended hundreds of retirees from Long Island Railroad seek payments from the US Railroad Retirement Board during 1998 until the present. According to court documents, more than $300 million in fraudulent benefits have been paid out.
The funds were designed to benefit those who are legitimately disabled. However, with the physician's help, former employees of the railroad sought benefits based on claims they could not bend, stand, or hold objects without chronic pain. Those seeking benefits were then identified as having participating in various activities including shoveling snow, playing golf, and even trekking on a 400-mile bike ride.
One of the participating doctors involved in the fraud collected as much as $2.5 million in compensation over the course of the scam. There was a third doctor participating in the fraud who has since passed away. The doctors were charged with utilizing their practices as ‘disability mills' and their offices were involved with 86% of all disability benefits applications at the LIRR that were filed prior to 2008.
LIRR employees that retire and claim disabilities can be eligible to receive benefits that nearly equal the total of their base salary earned during their career. Employees are allowed to retire at the age of 50 as long as they have worked for 20 years. Retires of the LIRR can also receive a pension starting at age 65.
The investigation was launched after the LIRR began receiving an unusually high amount of new applications from retirees. Those who are alleged to be involved in the fraud are still entitled to receive their pension but it was not known if payments would continue if the individuals were convicted.
Read More About 11 Busted in Disability Scam Against NY Railway Worker Funds...
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