DA: Store owner bilked LIPA of over $40G
A Farmingdale hardware store owner has been charged with stealing more than $40,000 from the Long Island Power Authority by submitting hundreds of fraudulent rebate coupons and advertising invoices, prosecutors said.
Thomas Schuman, 44, of St. James, was charged Thursday with two counts of grand larceny and seven counts of offering a false instrument after he over-reported advertising costs and submitted rebates for compact fluorescent light bulbs that were never sold, according to the Nassau County district attorney's office.
Schuman, who faces up to 7 years in prison if convicted, was released on his own recognizance following his arraignment Thursday in First District Court in Hempstead. Neither he nor his lawyer could be reached for comment.
"Mr. Schuman used every trick he could think of to line his own pockets, even forcing employees to assist him in his scams," Nassau County District Attorney Kathleen Rice said. "He victimized every honest ratepayer on Long Island, and now he'll have to face the consequences of his actions."
A LIPA spokeswoman had no comment on the arrest.
Schuman, owner of Four Star True Value Variety Store on Main Street in Farmingdale, participated in LIPA's fluorescent light coupon rebate program from 2009 until 2011, prosecutors said. The program allows stores to offer discounts on compact bulbs -- ranging from 50 cents to $3 per bulb -- and then receive reimbursement from LIPA.
In December 2011, a LIPA audit found that Schuman's store had submitted 923 fraudulent rebate coupons and was reimbursed $22,240, prosecutors said.
A follow-up investigation by the district attorney's office revealed that Schuman instructed his employees to fill out the vouchers by instructing cashiers to use the phone book to find people who lived in the area and fill out a voucher in his or her name, even though that person had not purchased light bulbs and may never have been to his store, prosecutors said.
He also gave the cashiers a daily quota of vouchers to fill out, prosecutors said.
In the first quarter of 2011, the investigation revealed that Four Star was submitting about five coupons on behalf of each purported customer, and that it submitted 66 percent more rebate coupons than all Long Island Lowe's stores combined, prosecutors said.
Schuman is also accused of stealing an additional $19,200 from the utility by participating in a LIPA-sponsored program that reimbursed merchants for certain advertising costs, prosecutors said.