Ex-New York police officers, firefighters charged in disability scam

NEW YORK — One retired police officer who told the government he was too psychologically damaged to work ran a martial arts studio, prosecutors said. Another said his depression was so crippling that it kept him housebound, but he was photographed aboard a watercraft, they said. A third who said he was incapable of social interactions manned a cannoli stand at a street festival.

All were wrongly receiving thousands of dollars in federal disability benefits, prosecutors said Tuesday in announcing a sweeping fraud case involving scores of retired officers, firefighters and jail guards. The retirees faked psychiatric problems and many falsely claimed their conditions arose after the Sept. 11 attacks, authorities said.

“The brazenness is shocking,” Manhattan Dist. Atty. Cyrus Vance Jr. said.

More than 100 people were arrested, including 72 city police officers, eight firefighters, five correction officers and one Nassau County Police Department officer.


Four were ringleaders who coached the former workers on how to feign depression and other mental health problems that allowed them to get payouts as high as $500,000 over decades, Vance said.

The four — retired officer Joseph Esposito, 64; John Minerva, 61, a disability consultant for a detectives union; Raymond Lavallee, 83, a lawyer and former FBI agent and suburban prosecutor; and benefits consultant Thomas Hale, 89 — pleaded not guilty to high-level grand larceny charges. All were released on bail, ranging from $250,000 to $1 million.

Applicants for benefits allegedly were taught how to fail memory tests and how to act like people suffering from depression or post-traumatic stress disorder. If they claimed to be traumatized by Sept. 11, “they were instructed to say that they were afraid of planes or they were afraid of tall buildings,” Assistant Dist. Atty. Christopher Santora said.

Police Commissioner William J. Bratton said the arrests represented an effort to ensure that “the memories of those who did, in fact, contribute their lives or their physical well-being to dealing with 9/11 are not sullied.”


Over 26 years, the workers arrested collected about $22 million in bogus benefits, authorities said, and more arrests could follow. Prosecutors estimate that hundreds more people and as much as $400 million may be involved.