chief financial officer of connecticut insurance firm sentenced in 33 million scheme to steal client healthcare funds and defraud multiple lenders damian williams the united states attorney for the southern district of new york announced today that erin verespy was sentenced to 66 months in prison for her participation in a widespread 33 million scheme to misappropriate client healthcare funds and defraud multiple lenders through her role as the chief financial officer of employee benefit solutions llc ebs an insurance firm located in wilton connecticut verespy previously pled guilty before us district judge cathy seibel who imposed todays sentence us attorney damian williams said for nearly two years erin verespy helped manage a sophisticated widespread scheme to steal millions of dollars of client healthcare funds including with false and inflated invoices as part of that scheme verespy also defrauded lenders out of millions in doing so she abused a position of trust as a fiduciary of client money that was meant to pay for important healthcare expenses thanks to the coordinated and tireless efforts of our law enforcement partners to untangle this fraud verespy will now serve a significant sentence in federal prison according to the information the complaint other court filings and statements made during court proceedings from at least july 2017 and continuing through 2019 erin verespy served as the cfo of ebs which offered a variety of healthcare insurancerelated services to clients ebs among other things provided third party healthcare claims administration tpa services to clients that elected to selffund or selfinsure their employee healthcare plans as a tpa ebs would purportedly administer process and pay healthcare claims for its clients employees in exchange for an administrative fee between at least 2015 and continuing through 2019 ebs represented an automobile dealership chain company1 headquartered in westchester county new york during this time period ebs served as a tpa for company1s selffunded employee healthcare program and purported to process and pay claims to medical providers that treated company1s employees to do this ebs generated bimonthly check register invoices for company1 that listed all employee healthcare expenses from healthcare providers during that twoweek period ebs also administered a bank account on company1s behalf for the express purpose of paying company1 healthcare claims company1 would fund each check register by paying the invoiced amount expecting that ebs would promptly pay the claims to the healthcare providers during this time period company1 transferred approximately 26 million to ebs for the payment of healthcare claims in reality a significant amount of purported checks listed on the ebs check register invoices were never actually deposited by the healthcare providers instead approximately 1787 million in company1 healthcare payments were misappropriated with the overwhelming majority simply transferred by ebs into its own operating account where they were used for nonhealthcare expenses by the managers and owners of ebs for example a review of bank records indicates that company1 healthcare funds were used by verespys coconspirators to pay their home mortgage expenses as well as a personal credit card account with expenses relating to boating luxury cars and golf verespy personally made over one million dollars from her participation in the fraudulent scheme ebs through verespy and her coconspirators made decisions on what few company1 healthcare claims they did pay based on which healthcare providers were likely to complain if they did not receive payment or if the claims were connected to company1 executives verespy for example discussed the timing of payments for company1 vips as well as a not vip claim that was nonetheless the subject of complaining phone calls the check registers sent to company1 also contained millions of dollars in fraudulent or inflated healthcare claims that were eventually paid by company1 ebs routinely inflated the company1 check registers at the direction of verespy and her coconspirators such efforts were typically accomplished through verespy and her coconspirators instructing others to manually create fraudulent entries in the ebs claims processing software including fake claims under the name of a business controlled by verespys coconspirators verespy and her coconspirators also took steps to conceal their fraud from company1 by creating and sending manipulated and fabricated bank statements and checks to create the appearance that healthcare claims were being paid by ebs when in reality they were not by mid2017 as ebs buckled under mounting outstanding fiduciary obligations verespy and her coconspirators began an elaborate effort to conceal and perpetuate the ongoing fraud on company1 by applying for multiple fraudulent bank loans and merchant cash advances designed in part to pay various fiduciary obligations that ebs owed to company1 verespy and her coconspirators fraudulently applied for and received millions of dollars in loans under the auspices of financing the purchase of upgraded billing software for ebs which included verespy and her coconspirators submitting fabricated invoices from a fake company that supposedly sold the billing software in addition to the prison term erin verespy 50 of trumbull connecticut was sentenced to 5 years of supervised release the court also ordered verespy to pay 1605350819 in restitution and forfeit 106603802 on april 14 2021 verespy pled guilty to one count of conspiracy to commit wire fraud and bank fraud in violation of title 18 united states code section 1349 mr williams praised the outstanding investigative work of the us postal inspection service and the special agents of the united states attorneys office mr williams also thanked the us department of labor employee benefits security administration the us department of labor office of inspector general and the united states secret service which are assisting in the investigation as well as the us attorneys office for the district of connecticut the prosecution is being handled by the offices white plains division assistant united states attorney nicholas s bradley is in charge of the prosecution