Catarina Young, 48, was found guilty of second-degree theft by unlawful taking and second-degree misapplication of entrusted property or property of a government or financial institution on Tuesday following a trial that spanned five weeks.
She faces up to 10 years in prison for each second-degree conviction. She will be sentenced on Jan. 3.
"This defendant showed a deliberate disregard for the welfare of those she was obligated to assist and instead left more than 1,000 employees and their families without vital health care coverage," Hoffman said in a prepared statement. "She now faces an appropriately lengthy prison sentence for her criminal actions."
Young was the partial owner of Elite Benefits Corporation, which is now defunct, Hoffman said. Elite administered insurance plans on behalf of third parties, including Multi-Skilled Employees and Employer Welfare Trust Fund, which consisted of several union employers and hundreds of employees, Hoffman said.
Young stood accused of depositing 86 checks and 16 wire transfers totaling $462,341 in Employer Welfare Trust Fund money for her own personal use. That money was intended for the purchase of health insurance coverage from Horizon Blue Cross Blue Shield of New Jersey and Benecard. The absence of that money resulted in the cancelation of health coverage for over 1,000 working people and their families, Hoffman said.
Over 100 exhibits were used during the trial, and many more were entered but not used, Hoffman said. There were 27 witnesses who testified.
“This conviction sends a message to all those involved in planned administration that the government will prosecute those who betray their fiduciary obligation by treating the hard-earned wages of hundreds of employees as their personal piggy bank,” Acting Insurance Fraud Prosecutor Ronald Chillemi said. “I commend the trial team, the detectives, and analysts who built and prosecuted this complex white-collar case together with the cooperation and hard work of the United States Department of Labor and the representatives of Horizon Blue Cross Blue Shield of New Jersey and Benecard.”
“Third-party administrators are placed in a position of trust by the workers and employers who rely on them to handle employee benefit contributions,” Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi said. “This is an excellent example of our commitment to working with state and local agencies to seek justice when this trust is violated.”