Former UAW Insurance Broker Sent to Prison for Theft

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UAW members and forced-dues payors have yet another reason to feel cheated by the huge union, as another illegal scheme concocted by union businessmen comes to light.  Yet another UAW (United Automobile, Aerospace and Agricultural Implement Workers of America) employee has been convicted and sentenced to prison for theft of union members’ dues in New Jersey.  Lawrence  Ackerman was formerly the insurance broker for UAW Local 2326 of  South River, New Jersey. 

According to documents filed in this case and statements made in court:

Ackerman was the chief operating officer of Atlantic Business Associates (ABA) and Atlantic Medical Associates (AMA), two “shell” companies through which he marketed health insurance nationally to people who were not his employees and therefore ineligible for health coverage. During the month of January 2011, he delivered $481,500 in health care benefits to ineligible participants.

The count of health care fraud to which Ackerman pleaded guilty is punishable by a maximum penalty of 10 years in prison and a fine of $250,000. Ackerman was originally charged in a two-count indictment with conspiracy to defraud Horizon Blue Cross Blue Shield of $5.6 million and the welfare fund of Local 2326 of $1 million in fraudulent health care claims. Under terms of the plea agreement, Ackerman will be responsible for making full restitution to Horizon and to the union’s benefit plan for their losses.

Ackerman apparently set up a couple of false insurance brokerages in order to market health plans nationwide to those who were not eligible for health coverage through UAW Local 2326.   Ending up with a substantial 7000- to 800 enrolees, Ackerman provided them with health insurance at inflated  premiums and filed inflated benefit claims on their behalf while his partner in crime kept the premiums.  The perpetrators managed to fool everyone for about 10 years until the Department of Labor investigated. 

View the UAW Local 2326’s LM-2 here.