Attorney Sentenced to Imprisonment for Insurance and

Pension Fraud, Reports U.S. Attorney.

BOSTON, July 31 /PRNewswire/ -Legal counsel to two Massachusetts roofing companies was sentenced today in federal court to a
term of imprisonment for conspiracy and misprision of felony, in a case arising from pension and
insurance fraud.
United States Attorney Donald K. Stern announced that MICHAEL FEINBERG, ESQ., age 59, of 26
Westward Road, Woodbridge Connecticut, was sentenced by U.S. District Court Judge Reginald C.
Lindsay to one year in prison, to be followed by four months' home detention and supervised
release. FEINBERG was also ordered to pay restitution in the amount of $620,000 to the insurance
company he had defrauded

FEINBERG pled guilty on March 27, 2000 to one

count of conspiracy to commit workers'
compensation insurance fraud involving
two Massachusetts roofing companies, and to one
count of misprision of felony relating to the
commission of pension fraud and embezzlement
from a Boston roofing union's pension funds.
FEINBERG was corporate counsel for B.H. Cutler
Roofing Company and Titan Roofing
Company, roofing contractors, with principal headquarters in Worcester and Chicopee,
respectively. As a result of his criminal convictions, FEINBERG has resigned his membership in the
Connecticut bar.
At the sentencing hearing, Assistant U.S. Attorney Gary S. Katzmann told Judge Lindsay that B.H.
Cutler Roofing and Titan Roofing are two of the largest roofing contractors in New England. He
further told the court that the laws of the Commonwealth of Massachusetts require employers to
obtain workers' compensation insurance coverage for their employees. Employers pay premiums to
an insurance company, in exchange for which the insurance company agrees to assume
the employer's risk of loss. The factors used in calculating a particular employer's workers'
compensation insurance premium include the employer's payroll, as well as the nature of
the employees' work activities. B.H. Cutler and Titan had arranged for Home Insurance Company to
provide workers' compensation coverage for their employees. On various dates between July 1992
and June 1995, FEINBERG conspired to defraud Home Insurance Company by
fraudulently reducing Titan and B.H. Cutler's premiums for workers' compensation insurance by
providing Home Insurance and its auditor with fraudulent records which understated the payroll of
Titan and B.H. Cutler, and provided false, lower-risk job classifications for their employees.
Additionally FEINBERG concealed his knowledge of the pension fraudand embezzlement felony
perpetrated by Arthur Grodd when he was theowner of B.H. Cutler. In 1997, Grodd pleaded guilty to
this pensionfraud and embezzlement (and other related crimes, including bribery andtax fraud), and
was sentenced to incarceration by the U.S. DistrictCourt, and paid full restitution to the union
pension funds. B.H.Cutler had entered into a collective bargaining agreement with BostonRoofers'

Local 33, United Union of Roofers, Waterproofers andAllied Workers, and was obligated to make
payments on behalf of itsemployees to various pension funds, which were protected by
theEmployees Retirement Income Security Act (ERISA). These payments wereto be based on the
total hours worked by covered employees. Grodd haddirected that B.H. Cutler file false and
fraudulent remittance reportswhich under-reported the hours worked by its employees,
therebyunlawfully reducing the contributions made to those ERISA pension fundsby B.H. Cutler.
In 1989, 1993 and 1995, the Local 33 pension funds retained an auditor to examine the records of
B.H. Cutler, and to review the discrepancies between the B.H. Cutler remittance reports and the
hours worked by some of its employees. Although FEINBERG knew of Grodd's pension fraud and
embezzlement, he provided the auditor retained by the Local 33 pension funds with false computer
summaries which reflected the false remittance reports filed by B.H. Cutler, and which appeared
to confirm B.H. Cutler's false representations regarding the hours worked by B.H. Cutler
employees. This knowing concealment by FEINBERG of Grodd's pension fraud and embezzlement
constituted misprision of felony.
United States Attorney Stern stated: "Feinberg's conviction and sentence should serve as a
continuing reminder that we will be vigilant in our efforts to prosecute those who undermine
the integrity of the workers' compensation insurance system as well as those who defraud pension
funds."
Since 1997, the roofers' investigation and prosecutions have yielded convictions of FEINBERG,
Arthur Grodd, as well as other related cases involving three subcontractors for tax fraud. Quite
apart from the $620,000 in restitution ordered today to the defrauded insurance company, as a
result of the successful prosecutions, Massachusetts union local ERISA funds have received full
restitution in the amount of $1,500,000.
The case was investigated by agents of the Massachusetts Insurance Fraud Bureau and the Office of
Investigations of the U.S. Department of Labor's Office of Inspector General, and was prosecuted
by Assistant U.S. Attorney Gary S. Katzmann of Stern's Healthcare Fraud Unit.
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