:: Ex-Cipriani VP gets prison
NEW YORK (AP) - A reputed mob money adviser who was vice president of the restaurant company that runs the Rainbow Room was sentenced to prison Monday for cheating Social Security and three insurance companies out of more than $1 million by filing false disability claims.
Dennis Pappas, who was vice president of Cipriani USA, pleaded guilty May 2 to second-degree insurance fraud in a deal with prosecutors. The sentence of 1 1/2 to 4 1/2 years means Pappas will be eligible for parole in 18 months.
Along with the world famous Rainbow Room in Rockefeller Center, Cipriani USA operates Harry Cipriani downtown, Cipriani Dolci at Grand Central Terminal, and Cipriani 42nd Street.
Pappas admitted that he falsely claimed he could not work because of heart problems and said he knew that 'if I disclosed my work and payments from Cipriani I would not be entitled to the disability payments.'
Pappas said Cipriani paid him at least $900,000 during the time he worked there from June 2000 until April 2006. For almost that entire time, prosecutors said, he was carrying out his disability scams.
Manhattan State Supreme Court Justice James Yates said Pappas must repay are Custom Disability Solutions $639,000; Cigna (NYSE:CI) Life Insurance Co. of New York $179,000; and Metropolitan Life Insurance Co. $109,000. Yates said the defendant must reimburse the Social Security Administration $90,000.
Defense lawyer Jonathan Bach told the judge that Pappas, 60, does in fact have severe heart problems. At Bach's request, the judge let the short, pudgy Pappas take with him a brown paper shopping bag containing a plethora of cardiac medicines. Yates also delayed Pappas's removal to a state prison until Aug. 2.
In 1998, Pappas was sentenced to 46 months in prison after pleading guilty to racketeering and income tax evasion. Federal prosecutors said he gave financial advice to, and laundered money for, the Colombo crime family. He was freed from prison after getting credit for time served while awaiting trial. Prosecutors said he was still under federal supervision when hired by Cipriani USA in 2000.
Yates said Pappas must pay the restitution at the rate of $11,000 a month, plus 5 percent of that as an administration fee. The agreement requires him to repay the Social Security Administration first.
