Ex-Mayor's Daughter Admits Stealing $940K From Brick's Health Insurance Plan

TOMS RIVER, NJ — The daughter of former Brick Township Mayor Joseph Scarpelli who had worked for the township for more than 30 years pleaded guilty Tuesday to stealing more than $940,000 from the township's self-funded health insurance program, state and township officials said.

Kim E. Bogan, 52, of Brick, pleaded guilty to second-degree theft by deception before Superior Court Judge Linda G. Baxter in Ocean County, state Attorney General Christopher S. Porrino said in a news release.

Bogan, Scarpelli's daughter, submitted the fraudulent claims for chiropractic services by Dr. Glenn Scarpelli, her brother, that were never in fact provided, township officials said in a news release. Glenn Scarpelli and his wife died by suicide in New York City earlier this summer.

Brick Township Mayor John Ducey said Bogan, who had worked for the township for more than 30 years, was fired by after the theft was discovered. In a news release, Ducey said the theft was uncovered by township Business Administrator Joanne Bergin during a review of health care claims. The township is self-insured for health insurance.

Porrino's office said the nearly $1 million in fraudulent claims occurred between January 2011 and April 2017.

According to a report from Horizon Blue Cross Blue Shield, which is the claims administrator for Brick Township, Bogan had been submitting fraudulent claims to the township for the phantom chiropractic services since at least 2007. The unusual number of claims for chiropractic services administered in New York City raised red flags during Bergin's review, Ducey said.

"We immediately contacted Horizon, our health care provider and claims administrator, which referred the matter to the Attorney General for investigation and prosecution,” Ducey said.

Joseph Scarpelli was sent to prison in 2007 after admitting to accepting bribes while serving as mayor in exchange for helping a developer gain approval for construction project.

As part of the plea agreement, the state will recommend a five-year prison sentence when Bogan is sentenced, scheduled for Jan. 2, 2018. She also will be required to pay $941,354.77 in restitution to the township.

“We uncovered the theft, notified the Attorney General and fired Kim Bogan. The next step is getting back the stolen money. We will take every legal action available to recoup these funds,” Ducey said. "I am angry that a municipal employee stole from our health care fund for so many years, with total disregard for the residents and taxpayers of our town.”

“The defendant allowed the practitioner to submit claims in her name for services never rendered, and endorsed the insurance checks when they were mailed to her, knowing the money was stolen,” Porrino said. "What’s even more disturbing is that she went along with the scheme knowing that the taxpayers of Brick Township — her friends and neighbors — would be responsible for picking up the tab for the bogus claims.”

Deputy Attorney General Thomas G. Tresansky Jr. represented the state in the plea hearing. Detectives Cortney Lawrence and Jared England coordinated the investigation. Porrino thanked Bergin, as well as Horizon Blue Cross Blue Shield Special Investigations Unit Senior Investigator Catherine Nielsen, Supervisor James Howell, and Manager Megan McCarthy for their assistance in the investigation.

People who are concerned about insurance cheating and have information about a fraud can report it anonymously by calling the toll-free hotline at 1-877-55-FRAUD, or visiting the Web site at www.NJInsurancefraud.org. State regulations permit a reward to be paid to an eligible person who provides information that leads to an arrest, prosecution and conviction for insurance fraud.

Editor's note: This article has been updated with information about Kim Bogan's relationship to former Mayor Scarpelli and the claims submitted through her brother that was provided by Brick Township officials in a news release.

Kim E. Bogan, photo provided by the New Jersey Attorney General's office