LOUISVILLE, Ky. (AP) — A Kentucky lawyer facing prison time for a scheme to defraud the government of nearly $600 million in federal disability payments took another legal hit Wednesday when a judge ordered him to pay nearly $31.5 million in damages to the government and two whistleblowers.
The ruling by U.S. District Judge Amul R. Thapar was the latest fallout for Eric C. Conn, the self-proclaimed "Mr. Social Security" who lived in a palatial home and was a frequent world traveler. Thapar ordered Conn to pay $12 million in damages and $19 million in penalties. The penalties represent the maximum $11,000 assessed for each fraudulent claim identified.
"He doesn't have those kind of assets anymore," said Scott White, one of Conn's attorneys.
Conn pleaded guilty recently to stealing from the Social Security Administration and bribing a federal judge. Prosecutors said Conn raked in millions of dollars by paying a doctor and a judge to rubber-stamp false disability claims using phony medical evidence.
As part of that plea deal, Conn is to pay $5.7 million to the government, reflecting the amount of fraudulent fees he received, and reimburse to Social Security $46 million it paid in disability claims based on fraudulent information Conn used.
"Eric Conn isn't going to walk away with a dime," White said in a phone interview. "If the goal was to ... render him penniless, that goal has been achieved."
Conn's legal team is weighing whether to appeal Thapar's order, White said.
In line for the damages and penalties awarded by Thapar are the federal government and former Social Security Administration employees Jennifer Griffith and Sarah Carver, who tried to expose the scheme.
Ben Vernia, an attorney for Griffith and Carver, said they will seek 25 percent of whatever amount is recovered when negotiating with the government on how to dole out the money.
"I don't think Jennifer and Sarah take any pleasure in the fact that they had to spend as much time as they did pursuing this lawsuit," said Mark Wohlander, another attorney for the two. "This case never had to happen. If the Social Security Administration had listened to Jennifer and Sarah in 2006, we wouldn't be here today."
Thapar's ruling was first reported by the Lexington Herald-Leader.
Conn, in his 50s, opened his law practice in a trailer in 1993 in 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.
According to his 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 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 court records. Those payments were based on falsified medical documents, the documents said.