A Long Island man convicted of racketeering for an investment fraud and what prosecutors called the largest no-fault auto insurance fraud scam ever charged was sentenced to 15 years in prison in federal court in Manhattan on Wednesday.
U.S. District Judge Paul Oetken said Mikhail Zemlyansky, 39, of Hewlett, a Ukrainian immigrant who came to the United States when he was 11, said he had ripped off millions from innocent investors and insurance companies in the schemes.
“The truth is that he has been a criminal for many years,” Oetken said to a courtroom packed with Zemlyansky’s relatives and supporters. “I have no doubt he cares about his family, but he did not care about his many victims.”
In a 2012 indictment charging 36 men and women, Zemlyansky was called one the organizers of the no-fault swindle, controlling medical clinics that recruited accident victims to receive unnecessary treatments that were charged to insurers.
In 2013, he was acquitted on eight counts and the jury deadlocked on a racketeering conspiracy charge. Prosecutors successfully retried him on that charge in 2015, and also convicted him on new charges of stealing more than $17 million from investors in two frauds.
Oetken said Zemlyansky and others employed phony websites and fake brochures to solicit money for companies called Lyons Ward & Associates and the Rockford Group.
“They pocketed the money after laundering the checks through Eastern Europe,” the judge said, noting that many victims were “older people . . . who gave up significant parts of their life savings.”
The sentence followed a rancorous exchange between prosecutors, who asked for more than 25 years, and defense lawyer Gary Becker, who described Zemlyansky as a community-minded youth soccer coach and post-superstorm Sandy aid worker.
Prosecutors, Becker said, were seeking “revenge” because Zemlyansky — who turned down a plea offer for a maximum of 10 years — fought them through two trials. “He is their white whale, and they are here to claim their spoils of war,” Becker told the judge.
In addition to the 15-year prison sentence, Oetken ordered Zemlyansky to make restitution of $29.5 million.