Amtrak Employees Criminally Charged In Medical Fraud

By Rail Passengers Staff

Amtrak’s Inspector General’s office uncovered widespread medical-claims fraud involving more than 100 Amtrak employees in seven states, who together managed to bilk Amtrak’s health-care plan of more than $12 million over a four-year period beginning in 2019.

“The sheer volume of employees who cavalierly participated in this scheme to steal Amtrak’s funds suggests not only a serious lapse in basic ethics, but a troubling workforce culture, at least in the Northeast region, in which blatant criminal behavior was somehow normalized,” said Amtrak Inspector General Kevin H. Winters. “After assessing the significant number of employees involved, this case represents the largest employee conspiracy our office has ever investigated.”

The Office of Inspector General, or OIG, says the scheme worked like this: some 119 employees accepted cash kickbacks from three health-care providers – an acupuncturist from Long Island City, New York, a New Jersey physician, and a New York podiatrist – who then used the employees’ insurance information to file fraudulent claims for services never provided or which were simply unnecessary. In some cases, they even used information for the employees’ dependents.

Of the 119 employees implicated, 61 were turned over to Amtrak management for potential “administrative disciplinary action,” the Inspector General said, while a dozen employees have been criminally charged. Seven have pled guilty and await sentencing. Another 28 retired or resigned “as a direct result” of the probe, OIG says, while 30 left Amtrak for other reasons.

Although the scale of the scheme was extraordinary, in some ways it mirrors a similar fraud scheme at the Long Island Rail Road, uncovered a decade ago by then U.S. Attorney for the Southern District of NY Preet Bharara. The essence of that fraud was that these employees exploited the overlap between the Long Island Rail Road’s pension plan and the nationwide Railroad Retirement Board disability program, falsely claiming they were disabled in a way to coincide with their retirement date.

“These false statements, made under oath in disability applications, allowed LIRR employees to retire as early as age 50 with an LIRR pension, supplemented by the fraudulently obtained RRB disability annuity,” the Justice Dept. said. That investigation led to 29 employees pleading guilty as part of a fraud that spanned 16 years until 2011.