Lawyer Charged In Accident Injury Ring [The Hartford Courant] - Insurance News | InsuranceNewsNet

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July 31, 2013 Newswires
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Lawyer Charged In Accident Injury Ring [The Hartford Courant]

Jenny Wilson, The Hartford Courant
By Jenny Wilson, The Hartford Courant
McClatchy-Tribune Information Services

Aug. 01--BRIDGEPORT -- A Bridgeport lawyer swindled millions from automobile insurance companies, according to a federal indictment unsealed Wednesday that accuses him of conspiring with others to boost settlements by exaggerating minor injuries, providing unnecessary drugs and bogus care and concocting phony medical records.

Joseph P. Haddad, 65, of Orange, pleaded not guilty to all nine counts of fraud, mail fraud and conspiracy in U.S. District Court in Bridgeport Wednesday. At times during the proceeding before U.S. Magistrate Judge Holly Fitzsimmons, Haddad tried to criticize the FBI special agents who investigated his case and had to be nudged into silence by his lawyer.

A sole practitioner who specializes in personal injury cases, Haddad is accused of being the ringleader in an elaborate scheme with health care professionals -- chiropractors, an unlicensed internist and an osteopath -- to defraud insurers. The six others charged in the investigation have pleaded guilty and some have agreed to testify against Haddad, Assistant U.S. Attorney Christopher Schmeisser said in court Wednesday.

Authorities say Haddad solicited clients to his then-high-volume practice by paying "runners" to track down victims of minor automobile accidents -- a practice known as ambulance chasing, which is illegal in Connecticut.

Once the accident victims became his clients, the indictment says, the attorney would advise them to seek prescriptions for muscle relaxants and strong painkillers, even if they did not plan to take them. He also would refer his clients to his alleged co-conspirators who provided services at Haddad's instruction and assigned permanent partial disability ratings to each of his clients, regardless of the true nature of their injuries.

Armed with fabricated medical records and bills for unneeded treatments, Haddad then would negotiate outsized insurance settlements, prosecutors said. The scheme lasted from 2006 to 2010.

The charges against Haddad and his alleged co-conspirators are the result of a 14-month undercover FBI investigation, which the Justice Department calls "Operation Running Man." The FBI staged an automobile accident to gain access to the conspirators and recorded conversations between an undercover agent and the participants in the conspiracy.

Haddad is accused of referring his clients to an unlicensed Fairfield doctor and a chiropractor from Stamford who in turn provided care and fabricated records based on the lawyer's instructions.

Francisco R. Carbone's license to practice medicine was revoked in 2005. As part of the scheme, authorities say, the unlicensed Bridgeport internist produced fraudulent medical records at the lawyer's request, inflating the seriousness of the conditions of patients, some of whom he never examined.

Marc Kirshner, the Stamford chiropractor, owned three chiropractic offices in Connecticut, as well as a diagnostic testing company. Kirshner agreed to treat each of Haddad's clients for six months, regardless of the actual injuries they suffered, which he and his employees would justify by fabricating medical records. Authorities say Haddad often ordered Kirshner to perform additional services on his clients -- instructions the chiropractor since has admitted he followed.

As part of the scheme, court documents say Haddad's clients frequently received "nerve conduction velocity tests" at the diagnostic testing company Kirshner owned, Midas Medical, a procedure that cost $2,000. In 2009, Kirshner and Haddad are said to have ordered Carbone to refer clients to the diagnostic testing company because the settlement would likely be higher if the test was ordered by a doctor.

Authorities also say Haddad determined how much his co-conspirators would be paid for the services ordered, sometimes paying them only a fraction of the amount he reported to insurers.

In cases where the victims were welfare recipients and the state was entitled to half of any insurance settlement, Haddad is accused of inflating the amount he and the providers received, which in turn reduced the net payout to the victim and the share the state received.

The U.S. Attorney's Office Wednesday said more than 10 insurance carriers lost approximately $2.5 million as a result of the scheme.

The investigation is still open. The others charged in the case include James W. Marshall Jr., an osteopath from Monroe who is accused of prescribing more than 4,400 painkillers for patients at Carbone's request; two of Kirshner's employees -- chiropractors Jennifer Netter and Jennifer Lynne, who allegedly received kickbacks of several hundred dollars when they ordered tests for Haddad's clients; and George DeCarvalho, of Stamford, a chiropractor who shared an office with Carbone and asked him to create a false report of injuries for him to use in an insurance claim after he was in an automobile accident.

Haddad was released Tuesday on a $150,000 bond. His charges come two years after the first charges were made in connection with the scheme.

During Haddad's court appearance, prosecutors disclosed that when authorities began charging his alleged co-conspirators, Haddad called a veteran's crisis center to ask a hypothetical question about when it is appropriate to kill an FBI agent.

They played a recording of a phone call in 2011 between Haddad and a police officer, during which the lawyer admitted he had posed the question.

"I just wanted to confirm whether I could kill somebody," Haddad said in the recorded call. He described the FBI agent who showed up at his house as a "punk."

"Two damn years and no charges and they won't even tell me what I did," Haddad sobbed in the recording, before becoming inaudible.

Each of Haddad's charges carries a maximum prison term of 20 years. Jury selection in his case is scheduled to begin in October.

___

(c)2013 The Hartford Courant (Hartford, Conn.)

Visit The Hartford Courant (Hartford, Conn.) at www.courant.com

Distributed by MCT Information Services

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