PIKEVILLE, Ky. (Feb. 20, 2013) — Eric C. Conn, an eastern Kentucky attorney who specializes in disability claims has been accused of scheming with a former judge to defraud the federal government out of millions of dollars.
In a civil lawsuit filed in 2011, but unsealed Tuesday in federal court in Pikeville, two Social Security Administration employees accused Conn and former judge David Daugherty of manipulating the system for assigning appeals in disability claims to ensure Daugherty heard Conn’s cases, according to an Associated Press report.
Attorneys in Lexington and the District of Columbia filed the complaint for the government under the federal False Claims Act, the AP said. It seeks to recover money that Conn allegedly received as a result of fraud.
The complaint was filed in 2011 but remained sealed until Tuesday. The federal government had been given an opportunity to intervene in the litigation, but opted not to, the AP said. Reasons for declining to join were not made public.
Daugherty worked in the Huntington, W.Va., office of the Social Security Administration, but retired in July 2011, the AP said. Conn has offices in Ashland and Stanville.
The suit claims the former judge awarded disability payments to Conn’s clients at a higher rate than other judges.
Many people were approved for lifetime disability payments they didn’t deserve, which could eventually cost the federal government tens of millions of dollars, said Benjamin J. Vernia, one of the attorneys who filed the claim, according to a report by the Lexington Herald Leader.
In 2010, Daugherty approved nearly 100 percent of the claims before him, according to the suit. The national average was 62 percent.
Conn, who describes himself online at “Mr. Social Security,” received a payment for each disability award, the Herald Leader reported. The Social Security Administration paid Conn $3.8 million for disability cases in 2010, the third-highest amount nationwide, The Wall Street Journal reported in 2011.
The two people who sued, Jennifer L. Griffith and Sarah Carver, said Daugherty often rubber-stamped requests for 20 of Conn’s clients a day and scheduled hearings at 10-minute intervals, while other judges spent 30 to 60 minutes in each hearing, the AP reported.
When asked by reporters about the claims made in the lawsuit, Conn said he has not seen “any lawsuit or papers and cannot comment until I do.”
“I can certainly say I have always tried to represent my clients in the best and most appropriate way possible within all the laws and rules,” he said. “It is noteworthy that the U.S. Government studied this lawsuit for a year and a half and decided not to join it or get involved.”
Daugherty was noted in a recent U.S. Senate investigative report into Social Security disability programs, according to Williamson Daily News.
The report was compiled for the Senate by the Permanent Subcommittee on Investigations. It claims the committee found that significant stress was being put on the Disability Trust Fund partly because “the number of individuals receiving disability benefits continues to rise at an unprecedented rate.”
Daugherty was among those cited in the report.
He was placed on indefinite administrative leave before retiring in July 2011 amid controversy, the Williamson newspaper said.