Peter Ajemian pleaded guilty in Manhattan Federal Court on Friday to taking part in a $233 million scam that falsely declared hundreds of Long Island Rail Road (LIRR) workers disabled in order for them to illegally collect pension benefits. Ajemian faces fraud charges, and could spend up to 12 and a half years in prison, on top of the $116 million in restitutions he has already agreed to pay.
Ajemian is a 63-year-old orthopedist from Rockville Center who allegedly began seeing hundreds of LIRR employees looking to be declared occupationally disabled. From 1998 until 2008, Ajemian said that he created false medical reports, taking advantage of the Federal Railroad Retirement Board’s disability benefits that supplemented regular pension payments.
The benefits were available for LIRR employees over the age of 50 that had been working with the company for at least 20 years. The age has since been changed to 55. Retirees that take part in the program are able to retire early and collect a portion of their pension which is normally available at 65.
In a four year period, Ajemian was responsible for overseeing nearly half of all LIRR employees that were collecting disability benefits, legitimate and illegitimate alike.
The employees that took part in the scam were able to retire early despite being fully capable of working. Ajemian allegedly made anywhere between $800 and $1,200 for each false medical report he put together. He claimed to have helped over 700 LIRR employees take advantage of the disability benefits.
The investigation has also led to fraud charges being filed against 32 other people, including 27 LIRR retirees and another doctor - Peter Lesniewski – who also took part in the scam. Lesniewski and Ajemian first faced the charges in October 2011.
“Dr. Ajemian enriched himself and debased his degree,” said Manhattan U.S. Attorney Preet Bharara. “21 defendants have now pled guilty for their roles in this breathtaking and brazen fraud that cost the Railroad Retirement Board untold millions of dollars.”
Ajemian is currently out of prison, and will face sentencing on May 24.