Twenty-Fifth Defendant Pleads Guilty in Manhattan Federal Court in Connection With LIRR Disability Fraud Scheme - Insurance News | InsuranceNewsNet

InsuranceNewsNet — Your Industry. One Source.™

Sign in
  • Subscribe
  • About
  • Advertise
  • Contact
Home Now reading Newswires
Topics
    • Advisor News
    • Annuity Index
    • Annuity News
    • Companies
    • Earnings
    • Fiduciary
    • From the Field: Expert Insights
    • Health/Employee Benefits
    • Insurance & Financial Fraud
    • INN Magazine
    • Insiders Only
    • Life Insurance News
    • Newswires
    • Property and Casualty
    • Regulation News
    • Sponsored Articles
    • Washington Wire
    • Videos
    • ———
    • About
    • Meet our Editorial Staff
    • Advertise
    • Contact
    • Newsletters
  • Exclusives
  • NewsWires
  • Magazine
  • Newsletters
Sign in or register to be an INNsider.
  • AdvisorNews
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Exclusives
  • INN Magazine
  • Insurtech
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Video
  • Washington Wire
  • Life Insurance
  • Annuities
  • Advisor
  • Health/Benefits
  • Property & Casualty
  • Insurtech
  • About
  • Advertise
  • Contact
  • Editorial Staff

Get Social

  • Facebook
  • X
  • LinkedIn
Newswires
Newswires RSS Get our newsletter
Order Prints
July 4, 2013 Newswires
Share
Share
Post
Email

Twenty-Fifth Defendant Pleads Guilty in Manhattan Federal Court in Connection With LIRR Disability Fraud Scheme

Targeted News Service

NEW YORK, July 3 -- The U.S. Attorney for the Southern District of New York issued the following news release:

Preet Bharara, the United States Attorney for the Southern District of New York, Martin J. Dickman, Inspector General of the Railroad Retirement Board ("RRB-OIG"), George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation ("FBI"), and Barry L. Kluger, Inspector General of the New York State Metropolitan Transportation Authority ("MTA-OIG"), announced that ROBERT ELLENSOHN, a former bridges and buildings inspector for the Long Island Railroad ("LIRR"), pled guilty today for his role in the allegedly massive fraud scheme in which LIRR workers claimed to be disabled upon early retirement so that they could receive disability benefits to which they were not entitled. ELLENSOHN pled guilty in Manhattan federal court before U.S. District Judge Sidney H. Stein. He is the 33rd defendant to be charged, and the 25th defendant to plead guilty in the case, which alleges a pervasive pattern of fraudulent disability claims being filed with the U.S. Railroad Retirement Board ("RRB") by retiring LIRR employees.

According to the Information filed today and statements made in other public filings and in court:

The LIRR Disability Fraud Scheme

The RRB is an independent U.S. agency that administers benefit programs, including disability benefits, for the nation's railroad workers and their families. A unique LIRR contract allowed employees to retire at the relatively young age of 50 - the age of eligibility has since changed to 55 - if they had been employed by the LIRR for at least 20 years. Eligible employees are entitled to receive an LIRR pension, which is a portion of the full retirement payment for which they are eligible at 65. In addition, at full retirement age (between age 60 and age 65 depending on years of service), they are eligible to receive an RRB retirement pension. For LIRR workers who retired at 50 with only an LIRR pension, they would receive less than their prior salary and substantially lower pension payments than those to which they would be entitled at full retirement age. However, LIRR employees who retired and claimed disability could receive a disability payment from the RRB on top of their LIRR pension, regardless of age. A retiree's LIRR pension, in combination with RRB disability payments, can be roughly equivalent to the base salary earned during his or her career.

Hundreds of LIRR employees have allegedly exploited the overlap between the LIRR pension and the RRB disability program by pre-planning the date on which they would falsely declare themselves disabled so that it would coincide with their projected retirement date. These false statements, made under penalty of prosecution in disability applications, allowed LIRR employees to retire as early as age 50 with an LIRR pension, supplemented by the fraudulently obtained RRB disability annuity. From 1995 through 2011, more than 75% of LIRR employees stopped working and began receiving RRB disability benefits, whereas during this same period, only 25% of retiring Metro-North employees stopped working and began receiving RRB disability benefits. During the period 2004 through 2008, only three doctors were responsible for approximately 86% of the disability claims submitted by LIRR retirees. Of these, one has died and one, Dr. Peter J. Ajemian, pled guilty and admitted that he declared "large numbers of Long Island Railroad employees" to be disabled even though they were not disabled and could have continued working in their railroad jobs. Dr. Ajemian was sentenced in <chron>May 2013 to eight years in prison.

ELLENSOHN, 59, of North Merrick, New York, pled guilty to one count of conspiracy to commit mail fraud, wire fraud, and health care fraud; one count of conspiracy to defraud the United States and the RRB; and one count of wire fraud. He faces a maximum sentence of 45 years in prison. ELLENSOHN is scheduled to be sentenced by Judge Stein on January 8, 2014.

Thirty-three people have been charged in connection with the LIRR disability fraud scheme, 25 of whom have now pled guilty. Of the 25 defendants that have pled guilty, two have been sentenced. The charges against the remaining defendants are merely allegations, and they are all presumed innocent unless and until proven guilty.

Mr. Bharara praised the work of the RRB-OIG, the FBI, and the MTA-OIG for their outstanding work in the investigation, which he noted is ongoing. He also acknowledged the previous investigation conducted by the New York State Attorney General's Office into these pension fraud issues.

The case is being handled by the Office's Complex Frauds Unit. Assistant U.S. Attorneys Justin Weddle, Nicole Friedlander, and Daniel Tehrani are in charge of the prosecution.

U.S. v. Robert Ellensohn Information (http://www.justice.gov/usao/nys/pressreleases/July13/EllensohnRobertPleaPR/Ellensohn,%20Robert%20Information.pdf)

CC 24CCPandaSan-130702-4415553 24CCPandaSan

Copyright:  (c) 2013 Targeted News Service
Wordcount:  786

Newer

KANETIX Exposes the Top 10 Travel Insurance Myths

Advisor News

  • The modern advisor: Merging income, insurance, and investments
  • Financial shocks, caregiving gaps and inflation pressures persist
  • Americans unprepared for increased longevity
  • More investors will seek comprehensive financial planning
  • Midlife planning for women: why it matters and how advisors should adapt
More Advisor News

Annuity News

  • LIMRA: Annuity sales notch 10th consecutive $100B+ quarter
  • AIG to sell remaining shares in Corebridge Financial
  • Corebridge Financial, Equitable Holdings post Q1 earnings as merger looms
  • AM Best Assigns Credit Ratings to Calix Re Limited
  • Transamerica introduces new RILA with optional income features
More Annuity News

Health/Employee Benefits News

  • Hospital, clinics hurting as fewer Tri-Cities patients have health care coverage
  • Reports on Insurance from State University of New York (SUNY) Albany Provide New Insights (Effects of National Insurance Reforms and State Medicaid Expansions Under the Affordable Care Act on Insurance Coverage Among American Indian and Alaska …): Insurance
  • Findings from Kristi Martin et al Has Provided New Information about Managed Care and Specialty Pharmacy (Assessment of IPAY 2027 Medicare drug price negotiation maximum fair prices with prices in most-favored nation reference countries): Drugs and Therapies – Managed Care and Specialty Pharmacy
  • Data on Hypertension Discussed by Denise Wolff and Colleagues (AMCP Market Insights: Getting to the heart of hard-to-control hypertension in managed care): Cardiovascular Diseases and Conditions – Hypertension
  • Democratic candidates revive single-payer promise as California's healthcare system faces strain
More Health/Employee Benefits News

Life Insurance News

  • AM Best Assigns Credit Ratings to Tokio Marine Newa Insurance Co., Ltd.
  • Earnings roundup: Prudential works to save ‘unique’ Japanese market
  • How life insurance became a living-benefits strategy
  • Financial Focus : Keep your beneficiary choices up to date
  • Equitable-Corebridge merger casts shadow over life insurance earnings
More Life Insurance News

- Presented By -

NEWS INSIDE

  • Companies
  • Earnings
  • Economic News
  • INN Magazine
  • Insurtech News
  • Newswires Feed
  • Regulation News
  • Washington Wire
  • Videos

FEATURED OFFERS

Why Blend in When You Can Make a Splash?
Pacific Life’s registered index-linked annuity offers what many love about RILAs—plus more!

Life moves fast. Your BGA should, too.
Stay ahead with Modern Life's AI-powered tech and expert support.

Bring a Real FIA Case. Leave Ready to Close.
A practical working session for agents who want a clearer, repeatable sales process.

Discipline Over Headline Rates
Discover a disciplined strategy built for consistency, transparency, and long-term value.

Inside the Evolution of Index-Linked Investing
Hear from top issuers and allocators driving growth in index-linked solutions.

Press Releases

  • Sequent Planning Recognized on USA TODAY’s Best Financial Advisory Firms 2026 List
  • Highland Capital Brokerage Acquires Premier Financial, Inc.
  • ePIC Services Company Joins wealth.com on Featured Panel at PEAK Brokerage Services’ SPARK! Event, Signaling a Shift in How Advisors Deliver Estate and Legacy Planning
  • Hexure Offers Real-Time Case Status Visibility and Enhanced Post-Issue Servicing in FireLight Through Expanded DTCC Partnership
  • RFP #T01325
More Press Releases > Add Your Press Release >

How to Write For InsuranceNewsNet

Find out how you can submit content for publishing on our website.
View Guidelines

Topics

  • Advisor News
  • Annuity Index
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • From the Field: Expert Insights
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Magazine
  • Insiders Only
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Washington Wire
  • Videos
  • ———
  • About
  • Meet our Editorial Staff
  • Advertise
  • Contact
  • Newsletters

Top Sections

  • AdvisorNews
  • Annuity News
  • Health/Employee Benefits News
  • InsuranceNewsNet Magazine
  • Life Insurance News
  • Property and Casualty News
  • Washington Wire

Our Company

  • About
  • Advertise
  • Contact
  • Meet our Editorial Staff
  • Magazine Subscription
  • Write for INN

Sign up for our FREE e-Newsletter!

Get breaking news, exclusive stories, and money- making insights straight into your inbox.

select Newsletter Options
Facebook Linkedin Twitter
© 2026 InsuranceNewsNet.com, Inc. All rights reserved.
  • Terms & Conditions
  • Privacy Policy
  • InsuranceNewsNet Magazine

Sign in with your Insider Pro Account

Not registered? Become an Insider Pro.
Insurance News | InsuranceNewsNet