White-Collar Crime

Lawyer and others face new charges in massive NYC disability fraud case, as dozens more are arrested

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An 83-year-old former prosecutor and three other claimed ringleaders in a massive New York City disability fraud case face new conspiracy charges, and dozens more defendants are being arrested concerning their roles in a scheme that authorities say went on for 26 years and may have involved 1,000 people.

Attorney Raymond Lavallee is accused of taking referrals from a retired police officer and a consultant for a city police group and working with a pension consultant convicted in 1983 in a similar scheme to submit disability applications. Lavallee is in private practice on Long Island and was an executive Nassau County District Attorney in the 1960s, according to the New York Times (req. req.) and the Wall Street Journal (sub. req.). All four have pleaded not guilty.

Twenty-eight new defendants are in the process of being arrested on various grand larceny charges after new indictments were unsealed Tuesday by the Manhattan District Attorney’s office. The other indictments were revealed last month.

Suspicious of applications that used identical language, investigators reportedly discovered that a number of those receiving Social Security Disability Insurance benefits were working or active in sports activities. The majority of the more than 100 people now charged in the case are retired police officers or firefighters.

A number of defendants are alleged to have claimed that mental conditions such as depression, anxiety or post-traumatic stress disorder prevented them from working.

The New York Daily News and the New York Post also have stories.

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