Kentucky lawyer pleads guilty in massive disability scheme

AP News
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Posted: Mar 24, 2017 7:45 PM

LOUISVILLE, Ky. (AP) — A flamboyant Kentucky lawyer who billed himself as "Mr. Social Security" pleaded guilty Friday for his role in what prosecutors portrayed as a long-running scheme to defraud the government of nearly $600 million in federal disability payments.

Eric C. Conn pleaded guilty in federal court in Lexington to stealing from the Social Security Administration and bribing a federal judge. The man who lived in a palatial eastern Kentucky home and was a frequent world traveler faces up to 12 years in prison at his July 14 sentencing.

"I'm stunned," said Ned Pillersdorf, an attorney who is representing hundreds of Conn's former clients who have sued in seeking damages from Conn.

Federal prosecutors claimed Conn raked in millions of dollars by paying a doctor and a judge to rubber-stamp false disability claims using phony medical evidence.

Conn, 56, pleaded guilty to one count of theft of government money and one count of payment of gratuities. His legal team did not immediately respond to calls seeking comment.

Conn opened his law practice in a trailer in 1993 in his hometown of Stanville, Kentucky, building it into one of the nation's most lucrative disability firms. He became a local celebrity for his over-the-top advertising campaigns. He dispatched crews of "Conn Hotties" to events and had a 19-foot replica of the Lincoln Memorial erected in the parking lot of his office.

He faced 18 counts in an indictment last year that also named a Social Security administrative law judge and a clinical psychologist.

According to the plea, Conn participated in a more than decade-long scheme involving the submission of thousands of falsified medical documents to the Social Security Administration. Those fraudulent submissions resulted in payment of more than $550 million in benefits, it said.

Conn also admitted to paying the judge about $10,000 a month over more than six years to award disability benefits in more than 1,700 cases, according to documents filed with the guilty plea. Those payments were based on falsified medical documents, the documents said.

Conn admitted that he received more than $5.7 million in representative fees from the SSA based on those fraudulent claims, the documents said.

Until his arrest, Conn had faced no legal consequences for years, even after the SSA had cut off disability payments to hundreds of his clients in the impoverished coalfields of eastern Kentucky and West Virginia.

Conn's clients have been fighting the federal government to keep their disability checks. Pillersdorf said that Conn's guilty plea is unlikely to have an impact on those cases

But Pillersdorf said the plea should help speed up consideration of the lawsuit in which hundreds of those former clients are seeking damages from Conn.

"I've got to get these people money quick," Pillersdorf said. "I've got 800 people going without, and it's a real humanitarian crisis. His guilty plea should expedite that process."

As part of the fallout from Conn's downfall, the Social Security Administration identified about 1,500 beneficiaries, mostly in eastern Kentucky, who could receive hearings to determine if their benefits should be reinstated, he said. The agency decided not to cut off those payments during that process after Republican U.S. Rep. Hal Rogers interceded.

Now, those hearings are nearly complete, and so far about 800 have lost their benefits, Pillersdorf said.

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Associated Press Writer Beth Campbell in Louisville contributed to this report.