Fraud Draws Disbarment

Disbarment based on a criminal conviction has been imposed by the New York Appellate Division for the Third Judicial Department

Respondent was admitted to practice by this Court in 1995, following his admission in Illinois in 1993. In February 2016, respondent pleaded guilty to the federal felony of health care fraud (see 18 USC § 1347) before the US District Court for the Northern District of Illinois, in connection with an indictment charging him with a litany of crimes associated with a scheme to defraud the Medicare and Medicaid programs through a hospice provider of which respondent was the founder, co-administrator and co-owner. In executing his plea, respondent made several admissions, including that he participated in a scheme to defraud Medicare and Medicaid through materially false and fraudulent pretenses, representations and promises to obtain money for the payment of health care services and benefits; that respondent knew that the hospice provider used improper criteria and failed to comply with Medicare and Medicaid standards; that he regularly billed those entities for medically unnecessary services and despite his lack of background as a medical provider; and that he agreed that patient records should be altered to conceal the scheme and respondent later signed letters attesting to the accuracy -2- PM-88-25 of each file, despite knowing that such statements were false. As a consequence, the Supreme Court of Illinois thereafter accepted respondent’s disciplinary resignation in that state and, in March 2017, respondent was sentenced to, inter alia, 6½ years’ incarceration and restitution in the amount of $9 million upon his guilty plea. The Attorney Grievance Committee for the Third Judicial Department (hereinafter AGC) now accordingly moves to either strike respondent’s name from the roll of attorneys due to his commission of a felony offense, or to impose discipline upon respondent as a consequence of his commission of a serious crime, or upon the finding of professional misconduct made against him in Illinois. Respondent has not responded to AGC’s motion.

Disbarment not automatic for the federal felony conviction

While AGC correctly asserts that essential similarity may be “established by looking beyond the elements and wording of the out-of-jurisdiction felony and to respondent’s conduct in the commission of the out-of-jurisdiction crime” (Matter of Philwin, 108 AD3d 129, 132 [1st Dept 2013]; see Matter of Chesebro, 231 AD3d at 1475-1476; Matter of Hand, 164 AD3d at 1007-1008), the sums paid to the hospice provider as a consequence of the fraudulent claims appear only in the context of sentencing, thereby indicating that such sums served only as an aggravating factor or as a basis for restitution, as opposed to a sum earned specifically from payments made as to the specific patient. Accordingly, we conclude that 18 USC § 1347 is not essentially similar to Penal Law § 177.20 and deny that part of AGC’s motion seeking to strike respondent’s name from the roll of attorneys as a consequence of his federal felony conviction.

Sanction

As to the imposition of discipline, AGC seeks respondent’s disbarment, which it argues is appropriate when a lawyer engages in serious criminal conduct which, among other things, involves intentional fraud, misrepresentation or false swearing (see ABA Standards for Imposing Lawyer Sanctions standard 5.11 [a]). We also take note of various other aggravating factors cited by AGC, including that respondent’s fraudulent scheme was fueled by his dishonest and selfish motive (see ABA Standards for Imposing Lawyer Sanctions standard 9.22 [b]) in order to increase monetary gain to the hospice provider business and to respondent himself, and that the scheme was perpetrated over several years and by multiple offenses (see ABA Standards for Imposing Lawyer Sanctions standard 9.22 [c]), including by the submission of false Medicare and Medicaid claims and the alteration of patient files, which was done to conceal his misconduct. Lastly, we note that respondent’s conduct is further aggravated by his failure to properly and timely report both his conviction (see Rules for Atty Disciplinary Matters [22 NYCRR] § 1240.12 [a]), and his interim suspension and disbarment in Illinois (see Rules for Atty Disciplinary Matters [22 NYCRR] § 1240.13 [d]). Further, as respondent has not responded to AGC’s motion, he has not submitted any factors in mitigation. Given the totality of the circumstances, and in order to protect the public, maintain the honor and integrity of the profession, and deter others from committing similar misconduct, we grant AGC’s motion and disbar respondent, effective immediately (see e.g. Matter of Adler, 211 AD3d at 1166-1167; Matter of Cooper, 122 AD3d 1057, 1057 [3d Dept 2014]; Matter of Kerekes, 95 AD3d 1431, 1432 [3d Dept 2012]; Matter of Daly, 43 AD3d at 1269-1270). Given this disposition, we dismiss as academic the remainder of AGC’s motion.

(Mike Frisch)