Two Ex-State Officials Charged With Illegally Disrupting Audit: Feds

FARMINGTON/BRISTOL, CT — A Farmington resident/former state official, along with a Bristol man/ex-lawmaker were both indicted by a grand jury for accepting bribes to disrupt a state audit of an eye doctor practice being investigated for health care fraud, among other corruption charges.

Federal officials Friday said a U.S. District Court grand jury in New Haven returned an 18-count indictment charging Konstantinos "Kosta" Diamantis, 68, of Farmington, and Christopher Ziogas, 73, of Bristol, with multiple charges related to cancelling a state audit of a Medicaid provider who engaged in health care fraud.

Marc H. Silverman, acting U.S. attorney for Connecticut; Anish Shukla, Acting Special Agent in Charge of the New Haven Division of the FBI; and Harry T. Chavis, Jr., Special Agent in Charge of IRS Criminal Investigation in New England; released details of the charges in a release Friday.

Silverman said both men appeared Friday before U.S. Magistrate Judge S. Dave Vatti in Bridgeport and pleaded "not guilty" to the charges and both were released on $500,000 bonds.

As alleged in the indictment, between January and June 2020, Diamantis, while serving at deputy secretary of the state Office of Policy and Management, and Ziogas, who served as a state representative for Connecticut’s 79th House District, engaged in a scheme in which Diamantis solicited and received corrupt payments and benefits from Helen Zervas.

Zervas is an optometrist and owner of Family Eye Care in Bristol.

The payments in question, Silverman said, were in exchange for official acts concerning a State of Connecticut audit of Zervas’s and Family Eye Care’s Medicaid overbilling.

Diamantis and Ziogas then took steps to conceal their conduct, Silverman said.

He said, as part of the alleged scheme, in January 2020, an official with Connecticut’s Department of Social Services (DSS) provided notice it would perform an audit of Zervas’s and Family Eye Care’s Medicaid billing.

"Zervas, who has been charged separately, knew that she had fraudulently overbilled Medicaid for medical services that she had not provided, or that were not medically necessary," wrote federal authorities in a statement released Friday.

Officials said Zervas sought assistance from Ziogas, who was her fiancée, to prevent the DSS audit from proceeding.

Ziogas, in turn, sought help from Diamantis, authorities said.

In exchange for payments from Ziogas and Zervas, Diamantis undertook official acts, and pressured other state officials to undertake official acts, aimed at favorably resolving the DSS audit, officials wrote.

As alleged in the indictment, on March 4, 2020, Ziogas made a bribe payment to Diamantis in the amount of $20,000, authorities claimed.

On that date, Zervas’s attorney emailed a DSS official with a settlement offer to resolve DSS’s audit, according to the release.

The next day, Zervas reimbursed Ziogas with a $25,000 check from Family Eye Care, authorities said.

On March 12, 2020, Ziogas made a $10,000 bribe payment to Diamantis and was subsequently reimbursed by Zervas, according to federal investigators.

After having been advised and pressured indirectly by Diamantis through officials at OPM and DSS, the DSS official cancelled the DSS audit and, on May 1, 2020, accepted Zervas’s settlement proposal, wrote authorities.

The indictment further alleges that, on May 12, 2020, Diamantis and Ziogas delivered a check from Family Eye Care in the amount of $599,810 to DSS, officials said.

On May 15, 2020, Ziogas, through Zervas, made a final bribe payment of $65,000 to Diamantis.

According to officials, the indictment also alleges Diamantis and Ziogas made multiple false statements when interviewed by the FBI during the investigation of this matter.

In addition, they claimed Diamantis failed to include the $95,000 in corrupt payments on his 2020 federal tax return.

Finally, the indictment alleges Ziogas, an attorney, separately committed bank fraud, wrote federal authorities.

Ziogas was the trustee of a client trust, identified in the indictment as “Trust-1.”

In November 2019, Ziogas prepared and caused to be negotiated a check from Trust-1 in the amount of $5,500 made out to “Kosta Diamantis,” officials said.

The indictment charges Diamantis and Ziogas with extortion under color of official right, which carries a maximum term of imprisonment of 20 years; bribery, which carries a maximum term of imprisonment of 10 years; conspiracy to commit extortion under color of official right, which carries a maximum term of imprisonment of 20 years; and conspiracy to commit bribery, which carries a maximum term of imprisonment of five years.

The indictment also charges Diamantis with seven counts, and Ziogas with two counts, of making false statements, which carries maximum term of imprisonment of five years on each count; Diamantis with one count of filing a false tax return, which carries a maximum term of imprisonment of three years; Ziogas with three counts of making illegal monetary transactions, which carries a maximum term of imprisonment of 10 years on each count; and Ziogas with one count of bank fraud, which carries a maximum term of imprisonment of 30 years.

This investigation is being conducted by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division.

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