Sandra L. Bielanski of OSI Collection Services Inc. Indicted, By Robert Paisola
Sandra L. Bielanski of OSI Collection Services Inc. was charged last week with crimes in her role of covering up a six-year over billing spree in the state of New Jersey that resulted in the state overpaying the debt collector by more than $1 million.
The Full IndictmentNew Jersey Attorney General Anne Milgram and Criminal Justice Director Deborah L. Gramiccion said in a press release that Sandra Bielanski was being charged with theft by deception, misconduct by a corporate official, and five counts of making false contract payment claims. The office noted that all charges represented second-degree crimes.
The indictments are the latest in a series of actions resulting from a lengthy investigation of OSI billing practices between January 1999 and May 2005. The state claims that OSI overbilled for collection services by more than $1 million in the period. In addition, OSI employees provided gifts to New Jersey officials to ensure the contract would continue.
In February 2007, OSI agreed to pay the state nearly $2 million to resolve issues of over billing and provision of illegal gifts to state employees (“OSI to Pay Nearly $2 million to Settle New Jersey Collection Contract Dispute,” Feb. 7, 2007). But legal action against individual OSI employees and state officials has been ongoing.
OSI noted at the time that all employees involved in the indiscretions were dismissed.
Bielanski was charged last week primarily for her role in covering up the overbilling. The indictment alleges that, as sales director, she became aware of the overbilling and conspired to conceal the false billing from the state.
“We now have indicted three employees of this vendor for deliberately overbilling the state by more than $1 million,” said Attorney General Milgram. “In today’s indictment, we charge that Ms. Bielanski learned of the unlawful billing and was complicit in efforts to cover it up.”
The state had already charged two other former OSI employees as “ring leaders” in the case: Enos Blake, an OSI vice president responsible for managing state projects, and Carol Labbe, his de facto second in command, according to state prosecutors. The AG’s office said that the two deliberately overcharged the state for debt collection work for more than six years, resulting in overpayments of $1,184,662 over that time.
In addition to the former company employee, three officials at New Jersey’s State Division of Taxation were charged with crimes in connection with the case. The former division director, Robert K. Thompson and two deputy directors, David M. Gavin and Harold E. Fox, were charged with making discretionary decisions while under undisclosed conflicts of interest caused by their receipt of meals, entertainment, golf outings and other gifts from OSI. Thompson and Gavin are charged with official misconduct and engaging in a pattern of official misconduct, and Fox is charged with official misconduct, all second-degree offenses.
The press release noted that Bielanski will be ordered to appear at a later date to answer the charges and that second degree crimes in New Jersey carry a maximum sentence of 10 years in state prison and a $150,000 fine.
About OSI:
As one of the nation's leading providers of strategic receivables management services, our clientele includes a blue chip roster of Fortune 500 clients. Through our services, our clients are able to improve their financial performance by accelerating cash flow, lowering operating costs, reducing bad debt expense and improving customer retention.
At OSI, you'll find over 6,000 associates working across 25 states, as well as Canada, Mexico and Puerto Rico. Our revenues exceeded $480 million in 2004.
Whether you're collecting consumer debt, commercial debt or managing the collection of debt we purchased from credit grantors, you'll be part of a great family of financial professionals. OSI is the corporate parent to a family of companies that provide a broad array of services within the account receivables industry. Some of our companies include:
OSI Collection Services, Inc. -
collects consumer and commercial debt, generally for a contingent fee
OSI Outsourcing Services, Inc. -
collects consumer and commercial debt in our clients' name (receivables management)
OSI Portfolio Services, Inc. -
manages the collection of charged off consumer debt purchased by OSI from credit grantors
OSI Education Services, Inc. -
education loan collections
Jennifer Loomis & Associates, Inc. -
medicaid billing
Qualink, Inc. -
healthcare receivables and management outsourcing
Gulf State Credit, LLC -
accounts receivable purchasing
Perimeter Credit, LLC -
accounts receivable purchasing
University Accounting Service, LLC (UAS) -
student loan billing service
RWC Consulting Group, LLC (RWC) -
staff augmentation services
Transworld Systems, Inc (TSI) -
Green Flag Profit Recovery
through the mail billing and collections service
OSI serves clients in the following industry groups:
- Commercial (business-to-business)
- Education
- Finance & Retail
- Government
- Healthcare
- Telecommunications
- Utilities
This is a Complete Copy of the Press Release Anouncing the OSI indictment:
TRENTON – Attorney General Anne Milgram and Criminal Justice Director Deborah L. Gramiccioni announced that the Division of Criminal Justice obtained a new indictment today charging the former sales director of OSI Collection Services Inc. with conspiring to falsely bill the state more than $1 million and cover up the unlawful billing.
According to Director Gramiccioni, the Division of Criminal Justice obtained a seven-count state grand jury indictment charging Sandra Bielanski, 41, of Hillsborough, with theft by deception, misconduct by a corporate official, and five counts of making false contract payment claims, all second-degree crimes.
Two other employees of OSI were previously charged in connection with the false billing. Enos “George” Blake, 61, of Kendall Park, and Carol Labbe, 41, of Jackson, also face second-degree charges of theft by deception, misconduct by a corporate official, and five counts of false contract payment claims. They were initially indicted in February 2007, and were charged in a superseding indictment on March 10, 2008.
The indictment against Blake and Labbe alleges that Blake, as the OSI vice president responsible for managing state projects, and Labbe, as his de facto second in command, purposely submitted improper bills between January 1999 and May 2005 that caused the state to overpay OSI by $1,184,662. The indictment against Bielanski alleges that, as sales director, she became aware of the overbilling by Blake and Labbe and conspired to conceal the false billing from the state.
“We now have indicted three employees of this vendor for deliberately overbilling the state by more than $1 million,” said Attorney General Milgram. “In today’s indictment, we charge that Ms. Bielanski learned of the unlawful billing and was complicit in efforts to cover it up.”
According to Director Gramiccioni, Blake and Labbe were responsible for signing off on payment vouchers submitted to the state under three contracts to collect delinquent and deficient taxes. It is alleged that Blake and Labbe purposely submitted improper bills in connection with nine OSI employees that resulted in the state making payments totaling $1,184,662 that were not authorized under the contracts.
The contracts provided for OSI to bill the state on an hourly basis for work performed in connection with the state contracts by employees who fit five defined job titles. In some cases, employees were identified with incorrect job titles that resulted in them being billed at a higher rate of pay, while in other cases employees were billed who should not have been billed at all.
“The State of New Jersey pays millions of dollars each year to vendors and must be able to count on the integrity of those with whom it does business,” said Director Gramiccioni. “We will vigorously investigate and prosecute corporate officials who deal dishonestly with the state.”
Bielanski also is charged in a state grand jury indictment dated Aug. 10, 2006, along with three employees of the State Division of Taxation. The former division director, Robert K. Thompson, 60, of Hamilton, and two deputy directors, David M. Gavin, 56, of Titusville, and Harold E. Fox, 60, of Wall, are charged with making discretionary decisions while under undisclosed conflicts of interest caused by their receipt of meals, entertainment, golf outings and other gifts from OSI. Thompson and Gavin are charged with official misconduct and engaging in a pattern of official misconduct, and Fox is charged with official misconduct, all second-degree offenses.
Under that indictment, Bielanski is charged with arranging for the state officials to receive the gifts and benefits. She faces six counts of offering an unlawful benefit to a public servant for official behavior, three in the third degree and three in the fourth degree.
The indictments resulted from investigations that were conducted and coordinated by Detective Benjamin Kukis and Deputy Attorneys General Thomas Clark and Steven Zweig of the Division of Criminal Justice Corruption Bureau. Deputy Attorneys General Clark and Zweig presented today’s indictment against Bielanski to the state grand jury.
Second-degree crimes carry a maximum sentence of 10 years in state prison and a $150,000 fine. The indictment is merely an accusation and the defendant is presumed innocent until proven guilty.
The indictment was handed up to Judge Linda R. Feinberg in Superior Court in Mercer County, where Bielanski will be ordered to appear at a later date to answer the charges. A copy of the indictment is available with this release at www.njpublicsafety.com.
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