A.G. Schneiderman Announces Guilty Pleas Of “Three-Quarter” Housing Operators Yury Baumblit And Rimma Baumblit

Yury Baumblit and Rimma Baumblit Will Each Serve State Prison Sentences For Medicaid Fraud Scheme that Forced Residents to Attend Treatment Programs Regardless of Medical Need

NY’s Medicaid Program Expects To Recoup $1.5 to $2.5 Million From Sale Of Baumblit Assets

   Attorney General Eric T. Schneiderman announced the guilty pleas and expected prison sentences of Yury and Rimma Baumblit, the operators of “three-quarter” homes in New York City for a scheme to defraud Medicaid through kickbacks. Kings Country Acting Supreme Court Justice Daniel Chun accepted the guilty pleas of both defendants on two counts each of Grand Larceny in the Third Degree. Three-quarter homes in New York City are private entities that provide housing to indigent, formerly homeless individuals and those transitioning out of periods of incarceration.

Both defendants were indicted in 2016 by the Attorney General’s Medicaid Fraud Control Unit for having defrauded the State Medicaid program through a systematic scheme whereby, in exchange for money, Yury  Baumblit and Rimma Baumblit mandated that the residents of their three-quarter homes attend substance abuse treatment at designated treatment programs regardless of medical need. At a later date, Yury Baumblit will be sentenced to concurrent terms of 2 ½ to 5 years in state prison for each crime; Rimma Baumblit will be sentenced to concurrent terms of 2 to 4 years in state prison for each crime.

“Yury Baumblit and Rimma Baumblit lined their pockets by preying on our most vulnerable New Yorkers,” said Attorney General Eric T. Schneiderman. “This should serve as yet another reminder that my office will aggressively pursue and prosecute those who seek to get rich by taking advantage of New Yorkers.”

In addition to their guilty pleas, Yury Baumblit and Rimma Baumblit each executed civil settlement agreements with the Attorney General’s Medicaid Fraud Control Unit. Under the terms of those agreements, each of them agreed to forfeit assets, including two properties they own in Brooklyn: a 5,000 square foot home in Manhattan Beach and a cooperative apartment in Brighton Beach. Each of them also agreed to forfeit luxury goods seized in connection with the civil action against them, including jewelry, watches, over 200 designer handbags, and 21 fur coats. The sale of assets is projected to realize between $1.5 and $2.5 million dollars in civil restitution for the State Medicaid program.

As part of their guilty pleas, Yury Baumblit and Rimma Baumblit admitted they had engaged in a kickback scheme with Medicaid-enrolled drug treatment providers Narco Freedom Inc., NRI Group, LLC, and Canarsie A.W.A.R.E. Inc. In exchange for monthly payments, the two individuals forced the residents at their three-quarter homes to attend treatment at these three drug programs, irrespective of the residents’ actual medical need for drug treatment services, and in violation of numerous State laws. Had the patients refused, they would have been evicted by the Baumblits and left homeless. The payments that Yury Baumblit and Rimma Baumblit received were based on the number of substance-abuse treatment sessions attended by residents of their three-quarter homes. During the course of the scheme dating back to 2010, the Baumblits received over $1.5 million in illegal kickbacks through five corporations they controlled: #1 Marketing Service, Inc., R Y B Realty, LLC, Steps to Better Living Inc., Orbit Management Group Inc., and Back on Track Group, Inc. As a result of this kickback scheme, the Medicaid program also paid over $2 Million to Narco Freedom Inc., NRI Group, LLC, and Canarsie A.W.A.R.E. Inc.

In 2016, the Attorney General’s Medicaid Fraud Control Unit also indicted NRI Group, LLC, Canarsie A.W.A.R.E. Inc., and the owner of both treatment programs, Anthony Cornachio, for their participation in the kickback scheme to which the Yury Baumblit and Rimma Baumblit pled guilty. Criminal charges remain pending against NRI Group, LLC, Canarsie A.W.A.R.E. Inc., and Anthony Cornachio. A trial is expected later this year. Narco Freedom was convicted last year of Enterprise Corruption for defrauding the Medicaid program in a related scheme. The charges against the remaining defendants are merely accusations and the defendants are presumed innocent unless and until proven guilty in a court of law.

Four of the Baumblits’ corporate entities – #1 Marketing Service, Inc., R Y B Realty, LLC, Steps to Better Living Inc., and Orbit Management Group Inc. – were previously convicted of Grand Larceny in the Second Degree. The other charged corporate entity, Back on Track Group, Inc. was previously convicted of Grand Larceny in the First Degree.  All the corporate entities were sentenced to a conditional discharge. 

Yury Baumblit and Rimma Baumblit were each previously convicted in 2009 by the Attorney General’s Automobile Insurance Fraud Unit for having participated in a no-fault insurance scam.

Throughout this investigation, the Attorney General’s office has worked closely with the various City, State, and Federal Agencies. The Attorney General would like to thank the New York City Human Resources Administration for its cooperation, partnership and valuable assistance throughout the investigation and especially note the work of its Medicaid Provider Investigations and Audit Unit. In addition, the Attorney General thanks the New York State Office of Alcoholism and Substance Abuse Services, the Office of the Medicaid Inspector General, and the United States Department of Homeland Security for their assistance. 

A.G. Schneiderman Announces Trial Conviction Of Long Island Man For Stealing From Bronx Medicaid-Funded Charity

Bronx Jury Found John Cornachio Guilty of Grand Larceny in the Second Degree for “No-Show” Job at Substance Abuse Treatment Provider through Which He Stole Over $800,000 

  Attorney General Eric T. Schneiderman today announced that a Bronx County jury found John Cornachio, 63, of Oyster Bay, NY, guilty of Grand Larceny in the Second Degree, a class C felony, for holding “no-show” job in order to steal from Narco Freedom Inc., a former Bronx-based, Medicaid-funded, not-for-profit corporation that was founded to provide substance abuse services throughout New York City. Cornachio faces up to 15 years in state prison when he is sentenced on March 2, 2018. Cornachio was remanded to jail pending sentencing.

“The defendant crafted an elaborate scheme in order to hide a no-show job and steal from New York taxpayers – exploiting a Medicaid-funded program that was intended to help those suffering from substance abuse,” said Attorney General Eric T. Schneiderman. “We will continue to aggressively pursue those who perpetuate these fraudulent schemes and bring scammers to justice.”

During the jury trial before Hon. Jeanette Rodriguez-Morick in Bronx County Supreme Court, the Attorney General presented evidence that Cornachio colluded with Narco Freedom’s corrupt management to have a “no-show” job at Narco Freedom. For over five years, Cornachio collected over $500,000 in salary and benefits paid by Narco Freedom. As part of his “no-show job,” Narco provided Cornachio with health insurance and a generous car allowance that he used to lease a Land Rover, among other benefits. The evidence also showed that Cornachio obtained over $300,000 from Narco Freedom through B&C Management, a shell company with no actual business that submitted fake invoices to Narco Freedom for services it never provided to the not-for-profit. Some of the payments were made in the names of John Cornachio’s minor children, who were supposedly rendering substance abuse counseling.

In 2015, the Attorney General’s Medicaid Fraud Control Unit (“MFCU”) indicted Cornachio, Narco Freedom Inc., its CEO, Alan Brand, and 12 other individuals and corporations for defrauding the state Medicaid program. All defendants indicted in connection with Narco Freedom have now been convicted of various crimes including Enterprise Corruption, Grand Larceny, and filing false information with government offices.

As part of the Narco Freedom investigation, the Attorney General also filed a civil action against Narco Freedom Inc. seeking asset forfeiture and other remedies, including treble damages and penalties under the New York State False Claims Act. The arrests and civil action by the Attorney General put an end to Narco Freedom’s illegal activity that exploited the Medicaid program and the vulnerability of thousands of Medicaid recipients – resulting in many millions of dollars in savings to Medicaid. As part of its plea and civil agreements, Narco Freedom acknowledged that it stole from Medicaid and admitted to filing false statements with various state agencies, including the New York State Department of Health and the Office of the New York State Attorney General’s Charities Bureau, in efforts to deceive and defraud these agencies. Narco Freedom filed for bankruptcy in January 2016. A bankruptcy court approved a $118 million settlement to settle Narco Freedom’s outstanding government claims, including those of New York State and the federal governments; the precise amount to be recovered in the bankruptcy proceeding is yet to be determined. 

In 2016, as part of the Attorney General’s investigation into fraudulent substance abuse providers and their exploitation of individuals living in substance abuse transitional housing, also known as “three-quarter houses,” MFCU also indicted Yuri Baumblit, Rimma Baumblit, Canarsie A.W.A.R.E. Inc., NRI Group, Inc., and Anthony Cornachio, John Cornachio’s brother and the owner of Canarsie A.W.A.R.E. Inc. and NRI Group, Inc., for defrauding Medicaid. Yuri Baumblit, Rimma Baumblit, and their companies have been convicted for that scheme. Criminal charges remain pending against Canarsie A.W.A.R.E. Inc. and Anthony Cornachio. The charges against those remaining defendants are merely accusations and those defendants are presumed innocent unless and until proven guilty in a court of law.

The Attorney General would like to thank the New York State Office of Alcoholism and Substance Abuse Services, the Office of the New York State Medicaid Inspector General, the New York State Department of Health, the Human Resources Administration of the City of New York, and the Civil Division of the United States Attorney’s Office for the Southern District of New York.

BRONX DISTRICT ATTORNEY DARCEL D. CLARK STATEMENT ON NOT GUILTY VERDICT FOR NYPD SERGEANT HUGH BARRY

  “The judge has issued his verdict in this case. We are disappointed but we accept his decision. However, I believe the death of Deborah Danner illustrates the larger issue of how we need changes in the way we address people with mental health issues.

 “There must be serious reforms to improve access to treatment so the situation does not rise to a crisis. Mental health professionals should be part of the response to emotionally disturbed persons.

 “I hope that measures will be taken to prevent another tragedy such as this.”

BRONX MAN INDICTED IN FATAL STABBING OF PIT BULL DOG LEFT IN HIS CARE BY OWNER

Defendant Charged With Animal Cruelty in Gruesome Death of “Onyx” 

  Bronx District Attorney Darcel D. Clark today announced that a Bronx man has been indicted on a felony Animal Cruelty charge for fatally stabbing and slitting the throat of an 18- month-old pit bull that was left in his care by the dog’s owner. 

 District Attorney Clark said, “The defendant allegedly stabbed the young dog more than 50 times and slit his throat, allegedly because the dog had bit him. This is an incredibly vicious crime and if the defendant is convicted he can face two years in prison. Cruelty against animals will not be tolerated.” 

 District Attorney Clark said the defendant, Stephen Richardson, 33, of 1237 Fulton Avenue, was arraigned today on a charge of felony Animal Cruelty before Bronx Supreme Court Justice George Villegas. Bail was set at $10,000 and he is due back in court on May 18, 2018. If convicted, he faces up to two years in prison.

 According to the investigation, on December 29, 2017, the defendant was watching “Onyx,” an 18-month-old male pit bull, in his apartment, as he had been doing for about six months. The dog’s owner stopped to check on him as she did frequently, and found him in the bathtub dead with multiple stab wounds primarily to the face and neck.

 At the same time, police were responding to a 311 complaint about possible animal abuse at the building, and went to the apartment and arrested the defendant. A knife was recovered.

 According to the investigation, the defendant said the dog bit him and in return he stabbed the dog in the park. Veterinarians said the dog died of a minimum of 55 sharp force wounds, including several that caused lacerations deep into the skin and tissue.

 District Attorney Clark thanked P o l i c e Officer Anthony Alvino of the 42 ND Precinct and Dr. Alison Liu of the ASPCA for their assistance. 

An indictment is an accusatory instrument and not proof of a defendant’s guilt.

Comptroller Stringer Announces NYC’s First “Making Rent Count” Pilot Program

In partnership with Banana Kelly, Comptroller Stringer to pilot new program to help New Yorkers boost their credit scores just by paying their rent

Over 600 New Yorkers across 27 buildings in the Bronx will be eligible for new pilot

  Comptroller Stringer, in partnership with the Banana Kelly Community Improvement Association, announced a new pilot program for the Comptroller’s “Making Rent Count” initiative, which will help New York City tenants establish or boost their credit scores just by paying their monthly rent. Working with Banana Kelly leadership, more than 600 tenants across 27 buildings in the south Bronx will now be able to add their rent payments to their credit histories, just like homeowners do for mortgage payments. Banana Kelly has agreed to report rent information directly to the credit bureaus for those who choose to participate in the pilot.

In October 2017, Comptroller Stringer’s “Making Rent Count” report showed deep disparities in credit scores across the five boroughs. A shocking one in five New Yorkers do not have a credit score and nearly one-third of city residents have sub-prime credit scores, which puts a ceiling on  financial success. Using never-before-analyzed data, the Comptroller’s Office found that in NYC communities where the average credit score is sub-prime, or below 630:

According to a 2015 study by the New York City Department of Consumer Affairs:

* 78% of residents are renters

* Black and Hispanic New Yorkers account for more than 90% of the population

* NYCHA residents comprise one in ten residents.

While renters’ credit scores are often penalized by landlords, bill collectors, and others when they fall behind on payments, renters do not see currently a benefit to their credit scores for paying their rent responsibly and are not given credit for the largest check they may write every month. This pilot project aims to correct that imbalance.

Through an opt-in program, the Comptroller’s Office has found that adding rent to credit scores would grant a new credit score to approximately 30% of renters for the first time. Research by the Comptroller’s Office shows that adding rent to credit would either raise scores or add additional depth to credit files for 94% of projected participants who currently hold a credit score. Specifically:

* More than half (57%) would see their score rise between 1 and 10 points;

* Nearly one in five (19%) would have their score boosted by 11 points or more;

* 18% would see no change at all;

* 6% would see a minor decline in their scores.

“We’re facing an affordability crisis, and we all know how soaring prices and sky-high rents make life difficult for New Yorkers across the five-boroughs. One of the hidden roadblocks to financial success is credit – and access to it. This innovative new program empowers tenants, helps level the playing field, and reflects another step to unstack the economic deck. It’s breaking new ground – and it will help make our city fairer,” said City Comptroller Scott Stringer. “To tenants, our message is simple. If you pay your rent on time every month, this pilot could ultimately be a game-changer. At a time when we need to use every tool in the kit to make our city more affordable, this new pilot could be the start of something important. I cannot thank our partners at Banana Kelly enough for their efforts and their work. Their participation reflects just how committed its leadership is to moving New York into the future.”

The 27 buildings in the Bronx in which the program will be piloted fall within three zip codes. All three zip codes rank among the bottom 10 percent of zip codes across the city by median credit score. More than 40 percent of residents in of each zip code have subprime median credit scores between 600 and 610. Moreover, over 40% of residents in each zip code have “thin file” credit meaning they may have never had a credit score or are new or re-establishing their credit. Given the opportunity to boost their credit scores or obtain scores for the first time, many residents will see real financial benefits, including the potential to pay much less on auto insurance, credit card interest rates, loans, cell phones, or other bills.

To read the full October “Making Rent Count” report, click here.

Bronx Democratic County Committee Call For Candidates in Two Upcoming Special Elections

  It was an unusually warm night in February for Thursday's County Committee call to find Democratic candidates to run in the upcoming special elections to be held on April 24th. 

  First up was to find a Democratic candidate to run for the 80th Assembly District vacancy created when former Assemblyman Mark Gjonaj was elected to the City Council. Bronx Democratic County Committee Chair Assemblywoman Latoya Joiner called the meeting to order, and it was said that a quorum of County Committee members from the 80th A.D. were present. Nominations were then opened up with Ms. Jean Hill nominating Nathalia Fernandez. Ms. Fernandez as then seconded by Mr. Joe McManus, and a third person. The question of any more nominations was asked, and nominations were then closed when there was no other. A unanimous vote then was taken making Ms. Nathalia Fernandez the candidate of the Democratic Party in the special election for the 80th A.D.

Above - Assemblyman Jeffrey Dinowitz, Assemblywoman Latoya Joiner, Counsel Stanley Schlein, and Maricela Salazar presided over the meeting.

Below - A very joyous Nathalia Fernandez is congratulated by Bronx Democratic County Leader Assemblyman Marcos Crespo and Councilman Mark Gonaj the former assemblyman from the 80th A.D.

  Things didn't go so smooth when it came to fielding a candidate for the vacant 32nd State Senate district however. The process began late as it was announced that a quorum was present, since the 32nd Senate District covers parts of the 79th, 80th, 82nd, 84th, 85th, ad 87th Assembly Districts. The meeting was called to order, and the process of selecting the Democratic candidate for the 32nd State Senate district began. 

  Ms Julia Rodriguez nominated Assemblyman Luis Sepulveda, This was seconded by Mohammed Mujumder, and Cynthia Cox. When the question of any more nominations Ms. Phillissia Amat rose to nominate Mr.Michael Beltzer. This was seconded by Ms. Alace Trane. There were no other nominations and the voting began. Chair Joyner called for those wishing to have Assemblyman Sepulveda as the Democratic candidate stand up. All but six county committee members stood up. Upon calling for those who wanted Mr. Beltzer as the candidate those six people stood up. It was then declared that by an overwhelmingly majority that Assemblyman Luis Sepulveda would be the Democratic candidate for the 32nd State Senate in the April Special election. 

Above - NY State Senate Democratic Conference Leader Andrea Stewart-Cousins and State Senator Michael Gianaris await the choice of Assemblyman Sepulveda as the Democratic candidate for the 32nd State Senate seat in the April spacial election.

Below - After being selected the Democratic candidate for the 32nd S.D. a beaming Luis Sepulveda thanks those who helped him become the Democratic candidate for his mentor now Councilman Ruben Diaz Sr.'s vacant state senate seat. 

Democratic candidate for the 32nd S.D. is congratulated by Senators Stewart-Cousins and Gianaris, Bronx Democratic County Leader Marcos Crespo, BDCC Vice-Chair Linda Kemp, and Councilwoman Vanessa Gibson. 

  After the meeting Mr. Beltzer claimed that there was not a quorum to which the Reform Party candidate for the 32nd S.D. Ms. Pamela Stewart-Martinez who was in attendance also said. While in the Bronx it is a forgone conclusion that the Democratic candidate wins every election, 'One never knows what may happen next in politics'. There is always a first time for everything Ms. Stewart-Martinez also said.

This posting has been updated to reflect the correct date of the special elections Tuesday April 24th. 

A thank you goes to Assemblyman Jeffrey Dinowitz for pointing out the error.

BP DIAZ & COUNCIL MEMBERS TORRES & DEUTSCH INTRODUCE FIRE SAFETY LEGISLATION PACKAGE

In the wake of December’s deadly Bronx fire, new legislative package would require safety devices on stove in apartments with small children and educational plan on fire safety

  Bronx Borough President Ruben Diaz Jr., City Council Member Ritchie Torres and City Council Member Chaim Deutsch are introducing a package of new legislation designed to prevent catastrophic fires in the wake of December’s tragic fire in the Belmont section of The Bronx, which saw 13 lives lost.

Three bills that would improve fire safety and education, and potentially save lives:

1.   One intro would require owners of buildings with three or more units to provide and properly install approved stove safety devices on all stoves in units where a child or children 10 years or younger reside;

2.  One intro would require the Fire Department, in coordination with the Education Department, to implement a comprehensive plan for educating children and parents about fire safety and prevention;

3.   One intro would require landlords to post a notice indicating that those escaping a fire should close all doors behind them.

In December, a fire in a residential building on Prospect Avenue in The Bronx led to 13 deaths, making it the deadliest fire New York City had seen in the past 25 years. Investigators found that the fire was started by a three-year-old child playing with the stove in his apartment, and quickly grew out of control.

“Just as we require window guards in apartments with young children, we should also require that stoves be made safer through the installation of approved safety devices,” said Bronx Borough President Ruben Diaz Jr.“This tragic fire could have been prevented, had this young child been unable to tamper with the knob of the stove in his apartment. I am proud to partner with Council Member Torres, amd Council Member Chaim Deutsch to introduce a new legislative package that will undoubtedly save lives.”

Above - The building at 2363 Prospect Avenue where the tragic fire occurred.

Below - BP Diaz Jr. holds a simple inexpensive child cover for a gas stove valve that he says can prevent children from playing with gas stove knobs.

Council Member Ritchie Torres said.  

“This comprehensive legislative package on fire safety, prevention and education will save lives and prevent household fires from happening. By installing safety knobs and proactively educating residents about fires, we are aiming to prevent another catastrophe. I thank Borough President Diaz Jr., for his partnership on these bills and advocacy on fire prevention, and look forward to their passage and enactment into law,”

Above - Councilman Torres speaks of the devastation which occurred in his district, and why these new proposals are so important.

Below - Councilman Chaim Deutsch came from Brooklyn to join with BP Diaz Jr., saying that this is not a one borough problem.

Council Member Chaim Deutsch said 

“Our City has suffered several unfortunate and tragic fires during recent months. With fire fatalities up 53% in 2017, this is an important time for us to raise awareness and make meaningful change. I’m grateful to my colleagues, Councilman Ritchie Torres and Bronx Borough President Ruben Diaz, Jr. for their partnership on this very critical initiative for all New Yorkers,”