Department of Labor: Cepr102105
Department of Labor: Cepr102105
Department of Justice
CONTACT PERSON:
SUSAN W. BROOKS
United States Attorney
(317) 226-6333
FOR IMMEDIATE RELEASE:
PRESS RELEASE
Susan W. Brooks, United States Attorney for the Southern District of Indiana,
announced that PAUL SCALI, 64, Indianapolis, Indiana, was sentenced to 37 months
imprisonment today by Chief U.S. District Judge Larry J. McKinney following their guilty
pleas to conspiracy to embezzle from a health care benefit program. This case was the result
Arrangement in which relatively small businesses in the construction trades were able to pool
resources to buy health insurance for their employees. PAUL SCALI was the chairman of the
board of trustees overseeing the health care benefit plan, and, starting around 1999, he also
oversaw the administration of the plan itself. RUSSELL ROTH was a vice president of the
trust’s insurance company and responsible for operations. Around February, 2001, SCALI
and ROTH began embezzling money directly from the trust’s operating accounts. SCALI
wrote checks directly out of operating accounts to himself, ROTH and others at the trust.
SCALI and ROTH also arranged for a charter airplane at the trust’s expense to take them and
others on personal trips. They did this without disclosing any of the payments to the board of
trustees. At the end of 2001, as the trust was moving deeply into debt, SCALI and ROTH
arranged to lease “precious stones” purportedly worth $2. 9 million, for a lease payment of
about $40,000, which they listed on the trust’s balance sheet as an asset with no corresponding
liability. The total amount of cash and benefits that were embezzled from the trust was
$441,250.
According to Assistant United States Attorney Winfield D. Ong, who prosecuted the
case for the government, Chief Judge McKinney also imposed 2 years supervised release each
for SCALI and ROTH following their release from imprisonment. SCALI and ROTH were
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