The United States Attorney for the Southern District of New York, Damian Williams, is investigating the high-profile trip and fall fraud scheme.
In the most recent development in the case, Adrian Alexander, a litigation funder, has been arrested by law enforcement agencies for his involvement in the fraud. The charges against him alleged his involvement in the conspiracy to commit mail and wire fraud to obtain millions of dollars from insurance companies and other entities as compensation awards in the fraudulent trip and fall accidents. After the arrest, the accused was presented before the United States Magistrate Judge Robert W. Lehrburger.
Alexander is the fifth individual accused of his involvement in the fraud scheme. Prior to him, charges had been made against four parties, including New York-based attorneys George Constantine and Marc Elefant, for violating their professional code of conduct and misusing their licenses.
Charges have also been made against two medical professionals, including Sady Ribeiro and Andrew Dowd, for their alleged involvement in the fraud scheme. These medical doctors were involved in fake surgeries and other forms of treatment of the recruits (fake victims) to give legitimacy to the injuries fraudulently incurred in the staged trip and fall accidents.
According to the charges against Alexander, he is a litigation funder and has been allegedly involved in financing fraudulent lawsuits in furtherance of the trip and fall scheme. He reportedly provided capital for these lawsuits to multiply returns from successful claims by charging a high-interest rate on the final proceeds.
Law enforcement agencies will further investigate the charges to determine the criminal role of the accused, and the case has been assigned to District Judge Sidney H. Stein.
District Attorney Damian Williams confirmed the reports of charges framed against Alexander in his media briefing. He stated that Alexander was involved in funding a fraudulent lawsuit for selfish personal interest. In the process, he exploited the desperation of others for his financial gains. However, the efforts of law enforcement agencies, especially the FBI, will ensure the enforcement of the law and impose penalties on individuals like Alexander, who use their capital to exploit vulnerable members of society.
The fraud claim
According to the details shared, Alexander and his codefendants were engaged in an extensive fraud scheme. They used to stage false trip and fall accidents and file fraudulent lawsuits against different insurance companies and stakeholders to obtain monetary benefits.
The modus operandi adopted by the accused and his codefendants involved the recruitment of individuals from low socio-economic strata of society to stage or falsely claim accidents at different locations within New York.
In the course of the fraud scheme, they recruited more than 400 patients. Initially, the participants were instructed to claim trip and fall accidents, but in reality, they had not faced such accidents. With the passage of time, they changed their strategy and began to instruct the recruits to stage fake trips and fall accidents. It means the recruits were taken to a particular location in New York City, and once they reached the place, the recruit deliberately staged accidents at that same pre-decided area. The most commonly used sites for accidents included cellar doors, cracks in concrete sidewalks, and potholes.
Once the recruited patients staged the trip and fall accident at any particular location, they were referred to specific attorneys who were also part of the scheme.
How the claims made it
The lawyers accused of involvement include George Constantine and Marc Elefant. Once the patient approached the lawyer, the lawyers used to file fraudulent personal injury claims against the owners of the accident site.
Even though the lawyers were fully conversant with the fraudulent accident, they did not mention it in the lawsuit and presented it as a legitimate injury claim. Reports have indicated that the participants of the fraud scheme, in fact, defrauded for more than 31 million dollars.
The patients were also not only instructed to make false claims and stage trip and fall accidents.
In order to convince the court and increase the compensation award, the conspiracy participants were offered $1,000 to $1,500 for surgeries. These surgeries were conducted by doctors allegedly involved in the scheme regardless of the medical need of the victim. They did not even think about the ramifications of surgery on the health of the victim and exploited the desperation of individuals. The common recruits are mostly homeless and drug addicts, etc.
The litigation funding company involved in the scheme
In the fraud scheme, financial support was provided by Alexander’s litigation funding company. He used to pay the litigation-related costs and, in some cases, provided funding for paying medical bills.
Even though some of the recruits had access to insurance or government-subsidized programs, this funding company paid for litigation costs. In return, the recruits were forced to enter into a financial arrangement with the litigation funding company to give a specific percentage of the settlement proceeds to the funding company.
Alexander claimed that his funding company has annual investment returns of over 30%. The report also indicated that Alexander has an MRI facility for the recruits (victims) exploited by the system.
The allegations framed against Alexander are very serious, and if convicted by a court of law, Alexander will have to face the implications. He may be imprisoned for years and have to pay heavy penalties. The trip and fall accident reveals the inherent structural issues in the legal system, which individuals like Alexander misuse to exploit the most vulnerable members of society, who are deprived of the basic amenities of life and forced to risk their life for a few hundred dollars.
Therefore, the case must be thoroughly investigated, and all the individuals involved in the fraud should be punished to set a precedent for others.