Albany, New York, Business Woman Sentenced To Serve 63 Months In Federal Prison For Bank Fraud And Embezzlement

Archived News Release — Caution: Information may be out of date.

Laurie Weinlein, former president of American Payroll Network, Inc. (APN) of Albany, New York, a now defunct employee leasing firm, was sentenced in the U.S. District Court in Albany on February 18, 2000, to 63 months imprisonment and five years probation after being convicted of bank fraud and of criminal violations of the federal law which protects employee pension and benefit plans. Weinlein will begin serving her federal prison term on April 18, 2000.

According to James M. Benages, New England Regional Director of the U.S. Labor Department’s Pension and Welfare Benefits Administration (PWBA), Weinlein was convicted by a federal jury in Albany on October 9, 1998 of embezzling approximately $300,000 from the American Payroll Network, Inc., Point of Service Health Plan, and of defrauding Marine Midland Bank of approximately $1 million. Benages stressed that Weinlein also was ordered by the court to make restitution of approximately $2 million, including nearly $250,000 to cover unpaid medical claims and third party administrator payments, as well as $1,019,019 in wages lost to employees whose paychecks bounced as a result of the defendant’s bank fraud scheme.

At one time, Benages noted, APN was one of the largest employee leasing firms in the region, handling the payrolls of 4,000 workers who were employed by 200 companies. Among the benefits offered to client employers and employees was a self-funded group health insurance plan. However, beginning around May 1994, APN failed to provide the necessary funding to pay medical and hospitalization claims. More than $300,000 in insurance premiums collected from participants was converted by Weinlein for her own use.

“This,” said Benages, “was an unconscionable abuse of trust. The Employee Retirement Income Security Act or ERISA has criminal provisions to combat this type of abuse of employee benefit plan assets, and this case shows we are not reluctant to use them.”

This matter was investigated by the Boston Regional Office of the Pension and Welfare Benefits Administration, which enforces ERISA, and the Albany Office of the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Sara M. Lord of the U.S. Attorney’s Office for the Northern District of New York.

United States v. Weinlein, 98-CR-204 (TJM), (NDNY, 5/26/98)

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Archived News Release — Caution: Information may be out of date.