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Nursing Home Operator In Fairfield, New Haven Counties Sentenced For Embezzlement

A New York man has been sentenced to 30 months in prison for embezzlement and tax offenses related to the operation of nursing homes.
A New York man has been sentenced to 30 months in prison for embezzlement and tax offenses related to the operation of nursing homes. Photo Credit: Pixabay/QuinceCreative

A Connecticut nursing home operator has been sentenced to 30 months in prison for embezzlement and tax offenses related to the operation of nursing homes.

Chaim Stern, age 72, a resident of Flushing,  Queens, was sentenced on Tuesday, April 20, for the offenses related to nursing homes in Bridgeport and Waterbury, said Leonard C Boyle, Acting U.S. Attorney for the District of Connecticut.

According to court documents and statements made in court, Stern was the principal operator of the Bridgeport Health Care Center, Bridgeport Manor, and the Rosegarden Health and Rehabilitation Center in Waterbury, which were privately owned nursing and rehabilitation facilities. 

 Between approximately 2011 and 2018, Stern stole more than $4.1 million from the companies pension plan by diverting the money to a purported charity, called Em Kol Chai, which Stern controlled, as well as to himself and other entities. 

Also, in February 2015, Stern misapplied $305,608.06 from the company's health plan by diverting the money from a stop-loss insurance plan that was intended to pay for an employee health claim and instead used it for other purposes, including Em Kol Chai, the operation of the BHCC, and for Stern’s personal use, the criminal complaint said.

Stern also failed to pay millions of dollars in other health insurance claims that he was obliged to pay on behalf of his employees, resulting in many cases in debt collection action against employees by the health care providers.

In addition, from at least January 2017 through March 2018, Stern failed to pay payroll taxes, resulting in a tax loss of  $4,356,409.85.

In January 2020, Stern pleaded guilty to one count of theft or embezzlement from an employee benefit plan, one count of theft or embezzlement in connection with healthcare, and one count of willful failure to pay tax.

He has already made approximately $4.1 million in criminal restitution to the pension plan, along with some lost interest as agreed upon in a related civil case. 

Stern was also ordered to pay restitution to participants in the health plan with unpaid claims, to the extent that the $2.5 million already paid by Stern and his insurance company in the related civil action do not cover all of those claims. 

Stern, who is released on a $500,000 bond, is required to report to prison on Wednesday, May 26.

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