New Jersey Board of Medical Examiners Revokes License of Essex County Cardiologist Who Shortchanged His Partners by Falsifying Pension Information

NEWARK, N.J., July 12 -- New Jersey Attorney General Christopher S. Porrino issued the following news release:

Attorney General Christopher S. Porrino and the Division of Consumer Affairs today announced that the State Board of Medical Examiners ("the Board") has permanently revoked the license of an Essex County Cardiologist whose oversight of his practice's retirement plan shortchanged his partners by underreporting the plan's value more than $12 million, in violation of his fiduciary duties under federal law.

Dr. Mario Criscito, a former partner in the Diagnostic and Clinical Cardiology ("DCC") medical practice in West Orange, voluntarily surrendered his license, to be deemed a permanent revocation, under the terms of a Consent Order with the Board.

The settlement resolves the State's bid to revoke Criscito's license after he was found civilly liable for violating the federal Employment Retirement Income Security Act ("ERISA") by fraudulently understating the balance in DCC's pension account and claiming the unreported assets for his personal use.

"This is a clear cut case of a greedy doctor who enriched himself by abusing the trust that his partners and employees placed in him as steward of their pension fund," said Attorney General Porrino. "Dr. Criscito was found to have spent millions of their retirement savings on personal investments, resort memberships, and to pad his own bank account."

The revocation of Criscito's license stems from a 2008 civil suit between Criscito and his DCC partners, which was litigated in the U.S. District Court for the District of New Jersey and the Third Circuit Court of Appeals (the "Civil Action"). Decisions rendered in those respective courts in January 2011 and March 2012 found that Criscito violated his fiduciary duty under ERISA by providing inaccurate and false numbers to American Pension Corporation ("APC"), the company managing the pension fund for his medical practice. The District Court awarded Criscito's partners $4.18 million dollars in damages and interest, along with additional attorney's fees and costs. This award was upheld by the Third Circuit Court of Appeals prior to the matter being settled between the parties.

As sole trustee of DCC's pension plan, Criscito controlled the two accounts that commingled the retirement savings of the 17 physicians and staff members who worked there. In December 1999, one month before the commingled funds were transferred from the group accounts to individual accounts, Criscito fraudulently understated the value of the group accounts by more than $12 million in a year-end report to APC, according to the findings in the Civil Action. The fraudulently understated values were then used to create the segregated accounts for individual members.

"As a result of Dr. Criscito's failure to reveal the true value of DCC's commingled pension account, plan members were shortchanged millions of dollars when the assets were divided up," said Steve Lee, Director of the Division of Consumer Affairs. "This kind of dishonesty and deceptive behavior are an egregious violation of professional standards that warrant the permanent revocation of Dr. Criscito's medical license."

The District Court concluded that Criscito's conduct was intentional and "cannot reasonably be viewed as the result of 'mere accident,'" noting that the physician took "affirmative steps" to conceal his breach of his fiduciary duty pertaining to the pension plan, including directing APC to send all documentation pertaining to the plan to his home address; requesting that APC refrain from speaking to anyone but him about the commingled accounts; and certifying that the untrue information he gave APC was accurate by signing multiple inaccurate federal reports.

In January 2014, citing the District Court's findings, the State filed an Administrative Complaint seeking the revocation of Criscito's license to practice medicine. The Complaint asserted that Criscito's actions constituted the use of dishonesty, fraud, acts of moral turpitude, and professional misconduct in violation of New Jersey's laws and regulations pertaining to the practice of medicine in New Jersey.

In August 2014, the State sought a Summary Decision from the Office of Administrative Law, which was granted in December 2016. In granting summary decision, Administrative Law Judge Jeffrey Gerson held "The fact that Criscito fraudulently misreported the account balances of the commingled accounts in 1999 by a staggering amount of more than $12,000,000 constitutes dishonest, fraudulent, deceptive, or a misrepresentative conduct under (state law). Additionally, misrepresenting account balances by more than $12,000,000 is conduct that may lower the standing and trustworthiness of the medical profession in the eyes of the public..."

Prior to the Board's consideration of ALJ Gerson's decision, Criscito consented to the revocation of his license. Under the terms of the Consent Order, Criscito was required to surrender his medical license to be deemed a permanent revocation effective July 1. He was also required to pay the State $35,000 in attorney's fees.

Despite consenting to the permanent revocation of his license, Criscito sought an eleventh hour stay of the effective date. After an unsuccessful application in the Chancery Division of Superior Court on June 30, a similar application for a stay pending appeal was denied by the Appellate Division that same day. As a result, the permanent of revocation of Criscito's license took effect as scheduled. Criscito's appeal remains pending before the Appellate Division.

Deputy Attorney General David M. Puteska, Assistant Chief of the Professional Boards Prosecution Section in the Division of Law, represented the State in this matter.

Shelia M. Mints, Esq. of Capehart Scatchard is Criscito's current counsel of record in this matter.

Patients who believe that they have been treated by a licensed health care professional in an inappropriate manner can file an online complaint with the State Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504- 6200.