A Garden City attorney and a Brooklyn couple have been charged in a fraud and kickback scheme that exploited recovering addicts living in group homes by forcing them into Medicaid-funded treatment programs, the state said Friday.
Anthony Cornachio, 74, used Medicaid as “a personal piggy bank,” state Attorney General Eric T. Schneiderman said in a statement.
Accused of making “at least” $1.7 million in false claims to Medicaid for reimbursement, Cornachio has been charged with first-degree grand larceny, second-degree money laundering and violating the state Social Services Law, Schneiderman said.
Cornachio was arraigned Thursday in Criminal Court in Brooklyn. He was released on his own recognizance, records show.
His attorney, Joseph A. Quatela of Hauppauge, said his client denies any wrongdoing.
“Mr. Cornachio will vigorously defend against these untrue charges and expects to be fully exonerated,” Quatela said in an email.
Cornachio, who serves as the village attorney for Island Park and is a trustee of Nassau Community College, owns and operates two drug treatment programs — the NRI Group LLC in midtown Manhattan and Canarsie Aware, Inc. in Brooklyn.
Also charged in the scheme were Yury Baumblit, 66, and his wife, Rimma, 60, and their company, Back on Track Group, Inc. of Queens.
Authorities said the Baumblits took more than $900,000 in illegal kickbacks from Cornachio, forcing residents of the group homes they operated in Brooklyn to attend programs at NRI and Canarsie by threatening them with eviction if they didn’t comply.
That allowed the trio to make the false claims for reimbursement of services to Medicaid, Schneiderman said. He said an investigation determined that some of the claimed services were either not provided or “medically unnecessary.”
“Medicaid cannot serve as a personal piggy bank for criminals and fraudsters who have little regard for the well-being of their fellow New Yorkers,” the attorney general said.
As part of the criminal complaint, the state obtained an order to freeze bank accounts and attach more than $5 million in assets held by the defendants, the attorney general said.
The group homes in question, known as “three-quarter houses,” have been criticized for maximizing profits and risking public safety by “packing as many people as possible into rooms,” according to a study by the John Jay College of Criminal Justice in Manhattan.
The rooms often are small and in illegally subdivided homes, where beds are placed “in living rooms, hallways and even kitchens,” according to the study.
The Baumblits previously were indicted and charged in a kickback scheme involving a different substance-abuse treatment program, Schneiderman said. Details on that case were not immediately available.
If convicted on all counts, authorities said, Cornachio and the Baumblits each face up to 25 years in prison.
In his role as an NCC trustee, Cornachio was criticized in 2013 for sending an email referring to an African-American student activist as a “thug,” and a female activist as “the youngest looking, and very pretty.”
He said at the time that the comments were in a private email and were not meant to be racially or sexually offensive.
NCC officials could not be reached for comment Friday.