Manhattan District Attorney Cyrus R. Vance, Jr., today announced the sentencing of ARON GOLDMAN, 59, to 2 1/2 to 7 1/2 years in prison and $800,000 in fines, for perpetrating a massive no-fault insurance fraud through a criminal enterprise known as the St. Nicholas Group, which stole more than $6.2 million from automobile insurance companies over a 5-year period. On March 15, 2010, co-defendant MATTHEW KESCHNER, 38, was sentenced to 1 1/2 to 4 1/2 years in prison and $750,000 in fines.
“This significant sentence follows a 3-month trial that exposed the inner workings of a criminal enterprise designed to exploit the no-fault insurance system,” District Attorney Vance said. “These fraudulent practices threaten the safety of patients, whose well-being was not driving the medical decisions made by the practitioners involved, and contribute to increased premiums for honest consumers. Our Office is committed to rooting out health care fraud wherever is it found.”
On December 13, 2010, a jury in New York State Supreme Court convicted GOLDMAN and KESCHNER of multiple felonies, including Enterprise Corruption, Grand Larceny, Money Laundering, Scheme to Defraud, Insurance Fraud, and Falsifying Business Records. As proven at trial, both defendants were associated with the St. Nicholas Group, a no-fault insurance clinic located at 1090 St. Nicholas Avenue in Manhattan. The enterprise used runners to procure patients, and at times, stage phony motor vehicle accidents and bring potentially injured parties to the facility. Services at the facility were provided by medical doctors, including GOLDMAN, and other healthcare professionals, including KESCHNER, a chiropractor.
On a daily basis, GOLDMAN, KESCHNER and numerous other providers prescribed unnecessary chiropractic, acupuncture, physical therapy and neurological treatments, procedures, and medical equipment. They also falsified medical records and other documents, and submitted false claims to insurance companies. In some instances, the billed services were provided only in part or not provided at all. The enterprise followed the same fraudulent practices with people who came into the facility with injuries from both staged accidents and from legitimate accidents, billing insurers for treatment or equipment that was either unnecessary or not actually provided.
Over a 5-year period, the enterprise stole more than $6.2 million from several insurance companies, including GEICO and Allstate, and from Enterprise, the car-rental company, which was self-insured. GOLDMAN, KESCHNER and others also used their professional corporations and their bank accounts to launder the proceeds of the St. Nicholas Group’s criminal scheme.
The owner of the St. Nicholas Group was co-defendant GREGORY VINARSKY, 64. On December 23, 2009, VINARSKY pleaded guilty to Enterprise Corruption, Scheme to Defraud in the First Degree, Grand Larceny in the First Degree, Money Laundering in the First Degree, and assorted tax offenses. VINARSKY testified at GOLDMAN and KESCHNER’s trial, and is currently awaiting sentencing. Because VINARSKY was not a licensed physician or chiropractor, he was forbidden under New York State Law from owning or exercising control over healthcare professional corporations. Thus, to conceal VINARSKY’S unlawful ownership and control of the St. Nicholas Group’s professional corporations, GOLDMAN, KESCHNER and other medical professionals all falsely claimed to own and operate their own professional corporations.
To date, sixteen convictions of defendants have resulted from the investigation. Eight other defendants have pleaded guilty and are awaiting sentencing.
District Attorney Vance thanked Assistant District Attorneys Michael Ohm and Michael Greenman for prosecuting the case under the supervision of Micki Shulman, Deputy Chief of the Major Economic Crimes Bureau, and Richard Weber, Chief of the Major Economic Crimes Bureau. Supervising Financial Investigator Brian Crowe; paralegal analysts Kathleen Dougherty, Jarrel Mitchell, Jennie Sirignano and Katie Ko; and DANY Investigators Terence Hayes, John Freck, Jose Flores and Chief Investigator John Bilich also assisted with this case.
District Attorney Vance also thanked Lt. Edwin Martinez, Sgt. Jolt Mena, and Dets. Samuel Guest, Kevin Mojica, and Joseph Oliver of the New York City Police Department; Lawrence Fuchsberg, Christopher Maloney and Edward Ferrity of the New York State Insurance Department, Frauds Bureau; Barbara Ann Chapman of Geico; Gerard LaRocco of MetLife; William Seegull of Allstate; Robert Kelly of Hertz; Michelle Mantilla of Enterprise; and Joe Valvana of the National Insurance Crime Bureau, all of whom assisted with the investigation and prosecution.
The defendants charged in the original indictment with Enterprise Corruption, including GOLDMAN and KESCHNER, are being sued in asset forfeiture for $6,270,980.87, the amount of money stolen over the 5-year period. Assistant District Attorney Suzanne Herbert is handling that matter under the supervision of Assistant District Attorney Tara Miner, Chief of the Asset Forfeiture Unit.
Defendant Information:
ARON GOLDMAN, D.O.B. 08/26/1951
New York, NY
Convicted:
Enterprise Corruption, a class B felony, one count
Grand Larceny in the First Degree, a class B felony, two counts
Money Laundering in the First Degree, a class B felony, one count
Money Laundering in the Second Degree, a class C felony, two counts
Scheme to Defraud in the First Degree, a class E felony, one count
Falsifying Business Records in the First Degree, a class E felony, one count
Insurance Fraud in the Third Degree, a class D felony, 5 counts
Insurance Fraud in the Fourth Degree, a class E felony, three counts
Sentenced:
2 1/2 to 7 1/2 years in state prison
$800,000 in fines
MATTHEW KESCHNER, D.O.B. 10/15/72
New York, NY
Convicted:
Enterprise Corruption, a class B felony, one count
Grand Larceny in the First Degree, a class B felony, two counts
Money Laundering in the Second Degree, a class C felony, one count
Scheme to Defraud in the First Degree, a class E felony, one count
Insurance Fraud in the Fourth Degree, a class E felony, four counts
Falsifying Business Records in the First Degree, a class E felony, one count
Sentenced:
1 1/2 to 4 1/2 years in state prison
$750,000 in fines
“This significant sentence follows a 3-month trial that exposed the inner workings of a criminal enterprise designed to exploit the no-fault insurance system,” District Attorney Vance said. “These fraudulent practices threaten the safety of patients, whose well-being was not driving the medical decisions made by the practitioners involved, and contribute to increased premiums for honest consumers. Our Office is committed to rooting out health care fraud wherever is it found.”
On December 13, 2010, a jury in New York State Supreme Court convicted GOLDMAN and KESCHNER of multiple felonies, including Enterprise Corruption, Grand Larceny, Money Laundering, Scheme to Defraud, Insurance Fraud, and Falsifying Business Records. As proven at trial, both defendants were associated with the St. Nicholas Group, a no-fault insurance clinic located at 1090 St. Nicholas Avenue in Manhattan. The enterprise used runners to procure patients, and at times, stage phony motor vehicle accidents and bring potentially injured parties to the facility. Services at the facility were provided by medical doctors, including GOLDMAN, and other healthcare professionals, including KESCHNER, a chiropractor.
On a daily basis, GOLDMAN, KESCHNER and numerous other providers prescribed unnecessary chiropractic, acupuncture, physical therapy and neurological treatments, procedures, and medical equipment. They also falsified medical records and other documents, and submitted false claims to insurance companies. In some instances, the billed services were provided only in part or not provided at all. The enterprise followed the same fraudulent practices with people who came into the facility with injuries from both staged accidents and from legitimate accidents, billing insurers for treatment or equipment that was either unnecessary or not actually provided.
Over a 5-year period, the enterprise stole more than $6.2 million from several insurance companies, including GEICO and Allstate, and from Enterprise, the car-rental company, which was self-insured. GOLDMAN, KESCHNER and others also used their professional corporations and their bank accounts to launder the proceeds of the St. Nicholas Group’s criminal scheme.
The owner of the St. Nicholas Group was co-defendant GREGORY VINARSKY, 64. On December 23, 2009, VINARSKY pleaded guilty to Enterprise Corruption, Scheme to Defraud in the First Degree, Grand Larceny in the First Degree, Money Laundering in the First Degree, and assorted tax offenses. VINARSKY testified at GOLDMAN and KESCHNER’s trial, and is currently awaiting sentencing. Because VINARSKY was not a licensed physician or chiropractor, he was forbidden under New York State Law from owning or exercising control over healthcare professional corporations. Thus, to conceal VINARSKY’S unlawful ownership and control of the St. Nicholas Group’s professional corporations, GOLDMAN, KESCHNER and other medical professionals all falsely claimed to own and operate their own professional corporations.
To date, sixteen convictions of defendants have resulted from the investigation. Eight other defendants have pleaded guilty and are awaiting sentencing.
District Attorney Vance thanked Assistant District Attorneys Michael Ohm and Michael Greenman for prosecuting the case under the supervision of Micki Shulman, Deputy Chief of the Major Economic Crimes Bureau, and Richard Weber, Chief of the Major Economic Crimes Bureau. Supervising Financial Investigator Brian Crowe; paralegal analysts Kathleen Dougherty, Jarrel Mitchell, Jennie Sirignano and Katie Ko; and DANY Investigators Terence Hayes, John Freck, Jose Flores and Chief Investigator John Bilich also assisted with this case.
District Attorney Vance also thanked Lt. Edwin Martinez, Sgt. Jolt Mena, and Dets. Samuel Guest, Kevin Mojica, and Joseph Oliver of the New York City Police Department; Lawrence Fuchsberg, Christopher Maloney and Edward Ferrity of the New York State Insurance Department, Frauds Bureau; Barbara Ann Chapman of Geico; Gerard LaRocco of MetLife; William Seegull of Allstate; Robert Kelly of Hertz; Michelle Mantilla of Enterprise; and Joe Valvana of the National Insurance Crime Bureau, all of whom assisted with the investigation and prosecution.
The defendants charged in the original indictment with Enterprise Corruption, including GOLDMAN and KESCHNER, are being sued in asset forfeiture for $6,270,980.87, the amount of money stolen over the 5-year period. Assistant District Attorney Suzanne Herbert is handling that matter under the supervision of Assistant District Attorney Tara Miner, Chief of the Asset Forfeiture Unit.
Defendant Information:
ARON GOLDMAN, D.O.B. 08/26/1951
New York, NY
Convicted:
Enterprise Corruption, a class B felony, one count
Grand Larceny in the First Degree, a class B felony, two counts
Money Laundering in the First Degree, a class B felony, one count
Money Laundering in the Second Degree, a class C felony, two counts
Scheme to Defraud in the First Degree, a class E felony, one count
Falsifying Business Records in the First Degree, a class E felony, one count
Insurance Fraud in the Third Degree, a class D felony, 5 counts
Insurance Fraud in the Fourth Degree, a class E felony, three counts
Sentenced:
2 1/2 to 7 1/2 years in state prison
$800,000 in fines
MATTHEW KESCHNER, D.O.B. 10/15/72
New York, NY
Convicted:
Enterprise Corruption, a class B felony, one count
Grand Larceny in the First Degree, a class B felony, two counts
Money Laundering in the Second Degree, a class C felony, one count
Scheme to Defraud in the First Degree, a class E felony, one count
Insurance Fraud in the Fourth Degree, a class E felony, four counts
Falsifying Business Records in the First Degree, a class E felony, one count
Sentenced:
1 1/2 to 4 1/2 years in state prison
$750,000 in fines
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