TRENTON – 292 fraud cases in Lakewood from state & federal sources have been documented in a 2017 presentation from the New Jersey State Comptroller’s Office that reveals information about investigations into Medicaid fraud in Lakewood.
Slides from a law enforcement presentation first made public by Ocean County Politics are offering a new glimpse behind the scenes of how the New Jersey State Comptroller’s Office & its partner agencies handled the Lakewood welfare fraud prosecutions and eventual implementation of a program that offered offending families amnesty from criminal prosecution contingent on the payment of a civil penalty and a temporary ban from participating in welfare programs.
The slides were from the New Jersey State Comptroller’s Office Annual Meeting and were provided on the condition of anonymity.
The federal and state prosecutions of Medicaid fraud in Lakewood spawned the unprecedented formation of the “Ocean County Recipient Voluntary Disclosure Program” by the New Jersey State Comptroller’s Office, whose Medicaid Fraud Division oversaw some of the state-level investigations of individuals & families defrauding Medicaid and other government benefits administered by state & federal agencies.
The voluntary disclosure program – which was the first of such a program to be limited to a single county – offered amnesty from criminal prosecution to welfare abusers. Just the Lakewood Vaad, an influential religious group with influence of the Orthodox community and Lakewood officials were consulted by the state comptroller’s office during the formation of the program, which was only open to residents of Ocean County.
After granting themselves an extension of time to provide responsive documents, the comptroller’s office denied a request made under the state’s Open Public Records Act (OPRA) seeking calendar entries of OSC staff during the time period for which the voluntary disclosure program was in formulation.
Also involved with meetings pertaining to the program was former State Comptroller Matthew Boxer. Boxer appeared in his capacity as an attorney at the meeting and represented the interests of the Vaad, according to sources familiar with the matter.
In a 2011 NJ.com article, Boxer was cited in a story about Medicaid fraud detection being too lax.
The Ocean County Prosecutor’s Office turned over a single email in response to another OPRA request, with that email reiterating some of the same statistics contained within the presentation that is the subject of this article.
An additional email obtained by OCP confirmed the involvement of Lakewood officials.
1. Private School Tuition Records Reviewed By Investigators
Payments made to some of Lakewood’s largest private, religious schools were reviewed by investigators from the State Comptroller’s Medicaid Fraud Division as a part of the operation, according to a slide from the presentation.
The school identified in the slide show presentation, Tashbar of Lakewood, had a founder who was described by the Asbury Park Press as having a “tumultuous” relationship with the federal government when it reported on the liens that were plaguing the school.
2. Financial Portrait of a Welfare Abuser: 38 Accounts Over 7 Banks, But a Reported Income of Only $25K
Using one family caught up in the multi-agency welfare abuse sting as a case study, the presentation included a graphic that showed the tangled web of bank accounts used to conceal the alleged fraud committed by an unidentified family that was caught up in the Medicaid fraud probe:
3. Average Difference Between Reported And Actual Income For County Prosecutions: $66,843
4. How They Did It
The presentation also broke down how the operator of a Lakewood beeper store illegally moved $6 million of money. The beeper store operator would later go to jail for his role in the scheme.
5. Investigations Have Been Underway Since 2015
Operation Blue Claw got off the ground in February of 2015, a slide on the presentation noted. Since that time period, 475+ subpoenas were served and more than 375 financial accounts were reviewed by investigators, according to the presentation.