Three moving company owners, including a Great Neck resident, as well as operators of an associated "fraudulent entity," engaged in a two-decade scheme to bilk state benefit programs of $15 million, New York Attorney General Letitia James said Wednesday.
James and New York City Department of Investigation Commissioner Margaret Garnett announced a 17-count indictment that charged the defendants with submitting thousands of false and inflated bids for moving and storage services to the New York Office of Victim Services and the New York City Human Resources Administration.
Since the agencies required their clients to submit three competitive bids to ensure the government paid the lowest price, James said, the defendants used "various fraudulent means" to divide the market and inflate prices for the services. They submitted rigged and false bids to the state and city agencies through clients who were public benefits recipients, domestic violence survivors and other crime victims needing relocation services.
"It is unconscionable that these individuals swindled programs that gave crime victims the chance to escape their dangerous situations, "James said. "Victims of crimes deserve every opportunity to get the help they need, but with financial gain in mind, the defendants took advantage of a system created to help those who needed it most."
The Attorney General's Office said that from 2001 to the present, company owners formed what investigators called a "sham trade association" called the United Movers Association.
Those owners facing charges include Avraham "Avi" Cohen, of Great Neck, owner of Avi Moving & Trucking Inc.; Derek T. Barney, of Carteret, New Jersey, co-owner of Prime Moving & Storage Inc. and Prime Moving & Trucking LLC; and Frank Lopez, of Queens, owner of Baya Inc. Moving and Storage.
The moving companies would tell clients that they would obtain, on their behalf, bids through their trade association. Instead, defendants would create two false, more costly bids and submit them, along with their lower bid on the United Movers Association letterhead, authorities said.
Additionally, the defendants operated what investigators called a "fraudulent entity" called the "Office of Eviction Service," which targeted clients by falsely identifying itself as a governmental or nonprofit organization, the office said.
Authorities said defendants Yeje Ramsaroop, of Winter Haven, Florida, and Gennovee Yeje, of Land o’ Lakes, Florida, identified themselves as program director and senior case manager, respectively. The Office of Eviction Services would tell clients it would assist them with obtaining three required bids for moving services. Instead, authorities said, the company submitted false, rigged and inflated bids for the same movers.
Additionally, Yeje incorporated another entity, Fastrac Processing LLC, which was "designed to secretly collect undisclosed kickbacks from the moving companies for the rigged and inflated bids that they were awarded through the Office of Eviction Services."
Yeje regularly emailed Barney, Cohen, and Lopez monthly invoices, detailing the jobs that they had been awarded and kickbacks owed to Fastrac Processing as a result of the false and rigged bids submitted on their behalf, authorities said.