New clients call me every day when they receive a letter from the Bureau of Fraud Investigation at the NYC Human Resources Administration. The letter says that their eligibility for Medicaid or Family Health Plus is being investigated. The new client's first question is always the same: Will I go to jail? The answer is: It depends on how you respond to the letter. Here are three actual cases that I handled recently with three very different outcomes. Unexplained Bank Deposits A woman who received one of these letters was very worried because her bank statements showed a large deposit -- more than $40,000 -- that was inconsistent with the very low income she had listed on her application for Medicaid benefits. The same amount was also reported on her tax returns as "income," but she had not reported that amount as income when she re-certified that she was eligible for Medicaid benefits. After talking with the client, I learned that she took the money out of her IRA because she was facing foreclosure and needed the money to save her home. She was in luck. While the money was considered "income" for tax purposes, it was not considered income for Medicaid purposes. Under New York Medicaid rules, a one-time withdrawal from an IRA, 401-k, or other retirement plan is considered liquidation of an asset. Withdrawals from retirement plans are only considered income if they are made on a regular basis over time. This is just one of the many complicated rules governing Medicaid that most people -- including many lawyers -- do not know. The client and I went in to see the investigator with an IRA statement showing that this was a one-time withdrawal. The investigator literally apologized for causing unnecessary anxiety and said she hoped the client would be able to save her home. Case closed. Blatant Fraud Another client came to me with a very serious problem. He had flat-out lied on his application and re-certifications for Medicaid benefits. He wrote that he earned only $400 per week when, in fact, he earned closer to $4,000 per week. Plus he owned businesses that paid the leases on luxury cars that he and his wife drove for both business and pleasure. Not only was this client facing the possibility of serious Medicaid fraud charges, but he also faced the possibility that the investigators at the Bureau of Fraud Investigation would refer his case to the tax authorities and other law enforcement agencies for serious civil and criminal investigations. After reviewing the client's financial records, we decided the best option was to admit that he was not eligible for Medicaid benefits and negotiate a settlement. The investigator presented the client with a very large claim -- tens of thousands of dollars -- for benefits the government had provided to the client and his family. I was able to negotiate two options for the client to get out of this mess. He could pay the claim in monthly installments over a period of 10 years with no interest or penalties. Or he could receive a discount if he paid the claim in full. The client took out his checkbook, paid the claim, and received a discount. The Human Resources Administration signed a settlement agreement stating that the payment resolved all claims against him, that no further action would be taken against him, and that his case would not be referred to any other government agency. Case closed. Penny Wise and Pound Foolish Puts the Client in Handcuffs A husband and wife received letters from the Bureau of Fraud Investigation asking them to come in for an interview and to bring all their financial records, including tax returns, bank statements, mortgage documents, etc. This couple decided not to call a lawyer. They went to the meeting on their own and tried to convince the investigators that they had done nothing wrong. They blamed an insurance agent for misleading them. The agent, they said, told them to list only the income on their pay stubs. The agent said they were not required to list other income they received from rental properties and a home-based business. When asked why they listened to the agent when the application forms clearly state that all income must be disclosed, the couple told the investigators that "everyone does it." The claim against this couple, about $15,000, was much smaller than the claim against the man who settled his case by admitting his wrongdoing and writing a check. But the investigators were not impressed by the couple's excuses and attempt to blame others. So they referred the case to the District Attorney's office. Several weeks later, the husband and wife were arrested and placed in handcuffs in front of their children. They spent a night in jail in separate cells. They were charged with four different felonies that carried possible sentences of four years in prison on each count. Because the husband was not a U.S. citizen, he also faced deportation if he was convicted of one of the felonies. That is when they decided to call a lawyer. It took almost three months of negotiations, but I was able to convince the District Attorney to let the couple avoid felony convictions (and the husband's deportation) by pleading guilty to misdemeanors and paying $15,000 in restitution plus a $5,000 fine. They were not sentenced to any prison time. If they had called a Medicaid fraud lawyer when they received the Bureau of Fraud Investigation's letter, there is a very good chance that they would not have been arrested or placed in handcuffs, they would not have spent a night in jail, they would not have paid a $5,000 fine, and they would not have criminal records. And the legal fee would have been much less than what I had to charge them for three months of work. The moral of these real-life stories is crystal clear. If you receive a letter from the Bureau of Fraud Investigation concerning your eligibility for Medicaid, call an experienced Medicaid fraud defense attorney immediately to protect your rights. You can reach me at (212) 601-2728 or click here to reach my law offices via email. The initial consultation is free and completely confidential. John Howley, Esq. The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. I invite you to contact our law offices and welcome your calls, letters and electronic mail. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established. I practice law and offer legal services only in jurisdictions where I am properly authorized to do so. I do not seek to represent anyone in any jurisdiction where this web site does not comply with applicable laws and bar rules.
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Almost every day, I help clients avoid criminal charges by getting involved in their cases before any charges have been filed. Then, about once or twice a month, a client comes in who made the mistake of speaking to investigators or prosecutors without a lawyer. Even though they are no more culpable than my other clients, the ones who speak to law enforcement on their own are often charged with felonies that could put them in prison for years. This is a terrible truth of our legal system: The people who “cooperate” sometimes get treated more harshly than the people who “lawyer up.” A recent case gives some insight into why this happens. A client came to see me after he was charged with serious felonies for Medicaid fraud. When I called the prosecutor to discuss the case, I asked why her office had charged felonies. Her answer was revealing. “Your client’s admissions gave us an open and shut case. Based on what he told us, we can prove all the elements of the felony charges.” Here lies the disconnect between how ordinary people approach the legal system and how it actually works. My client thought he was doing the right thing. He thought that the prosecutor would go easy on him if he came forward and just told the truth. During the interview, he emphasized how sorry he was and promised not to do it again. The hard-nosed prosecutors have heard these stories a million times. Some of the more cynical prosecutors say, “Everyone is sorry after they get caught.” Even the more compassionate prosecutors say that they would like to believe everyone who says they are sorry, but they cannot tell who is truly sorry and who is just putting on the sorry face to avoid prosecution. So, the prosecutors stick to the objective facts. If the facts add up to a felony, then they charge you with a felony. If you want leniency because you are truly sorry, then go tell it to the judge and jury. Or, better yet, do not talk to law enforcement until after you retain a lawyer. A lawyer can look at the facts and talk with the prosecutor before you decide whether or not to cooperate. What happened to my client who made the mistake of talking to prosecutors before getting legal advice? He pleaded guilty to a misdemeanor, paid $15,000 in restitution and a $250 surcharge. We avoided the tragedy of prison, but he now has a criminal record that will haunt him for the rest of his life. Later that same day, I met with investigators to negotiate a deal for another client who never spoke to anyone in law enforcement before coming to see me. The investigators agreed to settle the matter if my client paid back $11,500. Period. No criminal charges. No criminal record. And my legal fee was a fraction of the legal fee that I had to charge the first client. Every case is different. The results in one case do not guarantee a similar outcome in another case at a different time, under different circumstances, or with a different prosecutor. Sometimes, even with the best strategy, you end up with criminal charges and convictions despite doing everything possible. But you do have rights. And exercising those rights can make a difference. You have the right to remain silent. You have the right to a lawyer. Do not give up those rights. My phone number is (212) 601-2728. Or click here to reach my office via email. John Howley, Esq. The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. I invite you to contact our law offices and welcome your calls, letters and electronic mail. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established. I practice law and offer legal services only in jurisdictions where I am properly authorized to do so. I do not seek to represent anyone in any jurisdiction where this web site does not comply with applicable laws and bar rules.
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John Howley, Esq.
350 Fifth Avenue 59FL New York, NY 10118 (212) 601-2728 |