Metuchen Woman Found Guilty Of Stealing Nearly A Half Million From Insurance Trust Fund

Catarina Young (NJ Attorney General's office photo)

Catarina Young (NJ Attorney General’s office photo)

TRENTON – A Middlesex County jury found the primary owner and operator of a third-party insurance administrator guilty of stealing approximately half a million dollars from a trust fund that administered health insurance policies and prescription coverage for hundreds of employees and their families, Acting Attorney General John J. Hoffman announced.

Catarina Young, 48, of Metuchen, was convicted by a Middlesex County jury on Oct. 29 of second-degree theft by unlawful taking and second-degree misapplication of entrusted property or property of a government or financial institution. The conviction followed a five-week trial before Superior Court Judge Dennis Nieves. The charges were contained in a Dec. 15, 2011 Middlesex County grand jury indictment obtained by Deputy Attorney General T.J. Harker. Young faces up to 10 years in prison for each of the second-degree convictions.

“This defendant showed a deliberate disregard for the welfare of those she was obligated to assist and instead left more than 1,000 employees and their families without vital health care coverage,” Hoffman said. “She now faces an appropriately lengthy prison sentence for her criminal actions.”

“This conviction sends a message to all those involved in planned administration that the government will prosecute those who betray their fiduciary obligation by treating the hard-earned wages of hundreds of employees as their personal piggy bank,” Acting Insurance Fraud Prosecutor Ronald Chillemi said. “I commend the trial team, the detectives, and analysts who built and prosecuted this complex white-collar case together with the cooperation and hard work of the United States Department of Labor and the representatives of Horizon Blue Cross Blue Shield of New Jersey and Benecard.”

“Third-party administrators are placed in a position of trust by the workers and employers who rely on them to handle employee benefit contributions,” said Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi. “This is an excellent example of our commitment to working with state and local agencies to seek justice when this trust is violated.”

At the time the crimes occurred, Young was a partial owner of the now-defunct Elite Benefits Corp. (Elite), which was located in Middlesex County. Elite administered insurance plans on behalf of third-parties, including the Multi-Skilled Employees & Employer Welfare Trust Fund (Fund), an organization consisting of several union employers and hundreds of employees.

By convicting Young, the Middlesex County jury determined that between Nov. 17, 2003 and Dec. 26, 2006, Young, as fiduciary of the Fund, deposited 86 checks and 16 wire transfers totaling $462,341 belonging to the Fund into her personal bank accounts and, subsequently, used these stolen proceeds for her own purposes. The stolen proceeds were supposed to be used to purchase health insurance coverage from Horizon Blue Cross Blue Shield of New Jersey and Benecard. By stealing this money, Young’s actions resulted in the cancellation of a health insurance plan that insured more than 1,000 working people and their families.

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