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NYC disability insurance fraud may total $400 million

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Updated: 1/08 9:50 am
CBS NEWS


NEW YORK - More than 100 former New York City workers were charged Tuesday with 
faking psychological problems for insurance benefits. Prosecutors say the total bilked from Social Security disability insurance could reach $400 million, dating back to 1988.

According to the prosecution, Louis Hurtado was starring in instructional videos as a 6th-degree black belt, while telling the New York Police Department he was disabled with neck injuries and psychological problems. He is accused of taking $470,000 over 24 years.

 Richard Cosentino allegedly received $207,000 while claiming he was too depressed to go outside after the attacks on 9/11. 

Glenn Lieberman received $174,000. He was also too depressed to go outside. 

"As a New Yorker, as a U.S. citizen, I can only express disgust at the actions of the individuals involved in this scheme," said New York Police Commissioner Bill Bratton.

More than half of these cases came from those claiming the events of 9/11 left them unfit to work.

Prosecutors say the ringleaders coached them on how to act when examined by doctors, like how to fail memory tests and how to apply for benefits.

The operation was funneled, prosecutors say, by ex-cops Joseph Esposito and John Minerva, as well as former FBI Agent Raymond Lavalee and Thomas Hale, a pension consultant.

“The message of this indictment is that if you are considering falsifying or bilking any administration service or disability benefits, you shouldn’t, and if you do, you’re gonna get caught,” said Manhattan District Attorney Cyrus Vance Jr.

Joseph Esposito’s attorney is Brian Griffin.

“Mr. Esposito proudly served this city as a New York police officer. He came into this courthouse today, said two words very important, ‘not guilty.’”

© 2014 CBS Interactive Inc. All Rights Reserved.

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