Pennsylvania Man Arrested In $250K Disaster Fraud

U.S. Attorney's Office

District of New Jersey

FOR IMMEDIATE RELEASE

Wednesday, October 18, 2017

Pennsylvania Man Arrested For Defrauding Fema Of Over $250,000 In Hurricane Sandy Disaster Relief

CAMDEN, N.J. - An Ambler, Pennsylvania, man was charged today with using phony documents to collect $252,734 in FEMA-backed disaster benefits and insurance payments that were supposed to be used to cover storm damages to his mother's property in Ocean City, New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Nicholas Ochs, 54, is charged by indictment with one count of disaster benefits fraud, five counts of mail fraud and one count of theft of government funds. He appeared today before U.S. Magistrate Judge Karen M. Williams and was released on $100,000 unsecured bond.

According to the indictment:

In October 2012, the various counties of southern New Jersey, including Cape May County, suffered significant damage due to wind, rain, and flooding as a result of Hurricane Sandy. During that time, Ochs's mother lived in a house in Ocean City. In January 2013, Ochs, on behalf of his mother, filed an application with the Federal Emergency Management Agency (FEMA) seeking federal rental assistance and assistance for personal property damage, claiming that the property was unfit for occupancy as a result of the storm.

An inspector working on behalf of FEMA inspected the property and determined that the property was uninhabitable and that repairs were required. During the inspection, Ochs, acting as power of attorney, signed the application on behalf of his mother attesting that all the information on the application was true and correct. By signing the application, Ochs also acknowledged that any disaster relief money awarded would be returned if his mother received insurance benefits for the same loss. FEMA initially denied Ochs's claim citing the fact that the property was covered by flood insurance.

However, Ochs submitted fraudulent documents to FEMA indicating that the insurance provider denied his mother's claim. In addition, when applying for the federal assistance, Ochs allegedly submitted false documents claiming that, as a result of being displaced, his mother was renting another property on the same block in Ocean City. From January 2013 through December 2013, Ochs faxed fraudulent lease agreements and rental receipts and failed to disclose that the property his mother was renting was owned by his mother and that no rent was ever paid. In addition, in February 2013, Ochs contacted FEMA and made a claim for transportation assistance based on his false claim that his mother's 1985 Mercedes Benz was damaged by Hurricane Sandy.

As a result of the false documents, between February 2013 and December 2013, FEMA paid Ochs's mother $17,229 for rental assistance and $4,345 for home repairs. Ochs then used the money for his own personal expenses. The total amount of FEMA benefits for rental assistance and home repair that Ochs collected to which he was not entitled was $21,574.

In addition, after Ochs made an insurance claim for damages related to the storm, his mother's insurance provider ultimately paid her $231,160, $169,518 of which was held in escrow by the mortgage-holder, Wells Fargo. To entice Wells Fargo to release the funds, Ochs presented fraudulent invoices and forms that over-inflated the value of the work that was actually performed.

Based on the false invoices, Wells Fargo mailed numerous checks totaling $169,518 to the house in Ocean City, which Ochs deposited into bank accounts that he controlled and spent on personal expenses. These funds were ultimately paid for by FEMA pursuant to its National Flood Insurance Program, which backed insurance payments for disaster-related expenses. Altogether, Ochs allegedly defrauded FEMA of $252,734.

The count of disaster benefits fraud carries a potential penalty of 30 years in prison and a $250,000 fine. The mail fraud counts each carry a potential penalty of 30 years in prison and $1 million fine. The count of theft of government funds carries a potential penalty of 10 years in prison and a $250,000 fine.

The charges and allegations in the indictment are merely accusations, and Ochs is presumed innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents of the Department of Homeland Security, Office of Inspector General, under the direction of Special Agent in Charge Mark Tasky, with investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney's Office Criminal Division in Camden.

Defense counsel: Thomas Young Esq., Camden

Attachment(s):

Component(s):

DOJ - USAO

Press Release Number:

17-390

Updated October 18, 2017