Montgomery County Attorney Charged with Mail Fraud
PHILADELPHIA – United States Attorney William M. McSwain announced that Craig A. Cohen, age 55, of Blue Bell, Pennsylvania was charged by Information with one count of mail fraud. Cohen was an attorney who worked for approximately eight years for a Philadelphia, Pennsylvania law firm (“the Law Firm”). Cohen specialized in representing insurance companies in subrogation matters, particularly those matters involving losses generated by water damage. As a subrogation attorney, Cohen filed claims on behalf of insurance companies to obtain recoveries against product manufacturers and class action settlement funds after insurance companies covered losses of insured individuals due to water damage resulting from defective products.
Over the course of approximately four years, from 2015 through 2019, Cohen engaged in a fraudulent scheme to obtain financial recoveries from product manufacturers and class action settlement funds for his own benefit, based on (1) entirely fabricated subrogation claims; and (2) legitimate subrogation claims to which an insurance company client of the Law Firm, and not Cohen, was entitled to the financial recovery.
Cohen operated the scheme primarily from his home in Blue Bell where he created a legal entity, WLSP, PLLC (“WLSP”), which he used to file the fabricated claims. He also opened a post office box in Philadelphia and created internet domains and email addresses for his company so that his fraudulent business could function effectively and appear legitimate.
Cohen created fake subrogation claims by modifying the paperwork from legitimate claims that he and other attorneys had already successfully resolved on behalf of clients of the Law Firm. His fake paperwork for each claim made it falsely appear that losses to the insured were caused by one manufacturer’s defective product, when in fact, a different manufacturer’s product caused those losses. Where necessary, Cohen would physically damage products and take pictures of them to submit with his fraudulent claim. He also engaged an expert engineer to examine the defective product and issue a report describing the defect that would entitle Cohen’s purported client to a recovery against the product manufacturer or settlement fund.
In addition to submitting entirely fake claims, Cohen also used legitimate, unresolved claims from insurance company clients of the Law Firm and submitted those claims through WLSP, generating financial recoveries entirely for himself. In each of these cases, Cohen convinced the Law Firm’s client and the Law Firm that the claims were not viable and should not be pursued, when in fact, the claims were viable. In converting these legitimate claims to his own company’s name and pursuing them solely for his own benefit, Cohen defrauded the insurance company clients of the Law Firm that were entitled to a recovery as well as the Law Firm that was entitled to a contingency fee on those matters.
In total, Cohen submitted dozens of fraudulent claims, causing losses to numerous victims, including product manufacturers, class action settlement funds, insurance companies, and the Law Firm, for an alleged loss of at least approximately $3.4 million.
“Attorneys of any kind, public or private, take an oath to act in accordance with the law – not to use their law license to steal,” said U.S. Attorney McSwain. “The allegations here are particularly disturbing, as the defendant went to great lengths to deceive and defraud his employer and its clients of millions of dollars, which is illegal conduct for an employee in any line of work, but is especially egregious for a lawyer.”
If convicted, the defendant faces a maximum possible sentence of 20 years in prison.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.