According to Daniel Hubbard of Patch.com, 66-year-old Sergio Acosta of Passaic, NJ and 53-year-old Lawrence Ackerman of Old Tappan, NJ have been indicted by a grand jury last month in connection to a scheme meant to defraud Horizon Blue Cross Blue Shield of New Jersey and United Auto Workers Local 2326 out of $5.6 million.
Sergio Acosta was the former president of United Auto Workers Local 2326, and was an employee from 2002 to 2008 responsible for the union’s operations and benefits plan.
Lawrence Ackerman played his part by creating shell companies that he used to recruit and market health insurance to non-employees, and passed them off as employees who wanted health insurance; 700-800 ineligible people from across the United States, in fact.
Acosta and Ackerman attempted to defraud Horizon of $5.6 million by covering the ineligible “employees”. After an investigation, Horizon discovered the fraud and immediately pulled coverage from the union. According to U.S. Attorney Paul J. Fishman, Ackerman even then allegedly allowed these people continued coverage with the union’s self-insurance care plan.
Arraignment will be scheduled at a later date, and Acosta and Ackerman could face up to 20 years in prison and a $500,000 fine.