New York State Attorney General Eric T. Schneiderman has brought a 50-count indictment charging Matthew Pappalardo and his former employer, HiRise Engineering, P.C., with altering engineering reports prepared in connection with the assessment of structural damage of residential properties resulting from Superstorm Sandy.
Mr. Pappalardo and HiRise Engineering were charged with 25 counts of Forgery in the Second Degree, a class D Felony; Mr. Pappalardo also was charged with 25 counts of Unauthorized Practice of Engineering, a class E Felony.
“Fraudulently altering engineering reports undermines the integrity of the entire FEMA claims process, which homeowners and families rely upon in a time of crisis. Today's charges reveal a flagrant disregard for the well-being and safety of New Yorkers, and my office will not tolerate it,” said Attorney General Schneiderman.
In June 2014, counsel for owners of residential properties in New York that had incurred damage as a result of Superstorm Sandy reported alleged fraudulent alterations in engineering reports to the New York State Office of the Attorney General (“OAG”). In December 2014, the OAG's Criminal Enforcement and Financial Crimes Bureau commenced a criminal investigation into the alleged unlicensed practice of professional engineering and forgery of engineering reports by engineering firms operating in Nassau County and elsewhere in New York.
According to prosecutors, after Superstorm Sandy in October 2012, HiRise, a Uniondale-based engineering firm, was contracted to perform structural engineering assessments for properties covered under the NFIP. HiRise, in turn, retained numerous licensed professional engineers to perform house inspections and prepare engineering reports, prosecutors said.
According to prosecutors, the original reports authored by the on-the-ground, subcontracted professional engineers were altered by employees of HiRise under the direction of the project manager, Mr. Pappalardo. Mr. Pappalardo and the other HiRise employees who made the alterations to the original reports did not personally inspect the damaged buildings and were not licensed to practice engineering in New York State, prosecutors asserted. As alleged, the altered reports then were submitted by HiRise, and ultimately provided to the adjusting firms, without the consent or approval of the underlying professional engineers. Federal flood claim administrators and adjusting firms then relied on these reports as part of their evaluation of coverage under the National Flood Insurance Program, prosecutors asserted.
Mr. Pappalardo and Hi Rise were arraigned in Nassau County Supreme Court before Judge Robert Vogle. Bail for Mr. Pappalardo was set at $20,000 cash over $40,000 bond.
In addition to the crimes charged in Nassau County, the Attorney General said that his office's investigation into the damage assessment process after Superstorm Sandy also uncovered evidence of other crimes that fell outside the scope of New York State's jurisdiction. The Attorney General said that his office has referred these findings to the U.S. Department of Justice.
Steven A. Meyerowitz
Steven A. Meyerowitz, a Harvard Law School graduate, is the founder and president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. He may be contacted at [email protected].