Pandemic or not – Serious Insurance Fraud Criminal Must Serve the Sentence

Attempt to Avoid Sentence Because of Pandemic by Insurance Criminal Fails

Mikhail Zemlyansky is serving a 15-year sentence of imprisonment which was imposed in January 2016. He is currently incarcerated at the Federal Correctional Institution at Fairton, New Jersey. Defendant has moved for compassionate release under the First Step Act in light of the COVID-19 pandemic. The Government opposee the motion. In United States Of America v. Mikhail Zemlyansky, 12-CR-171-01 (JPO), United States District Court Southern District Of New York (July 6, 2020) the warden failed to grant compassionate release and Zemlyansky appealed to the USDC.

FACTS

Defendant was convicted of running a wide-ranging racketeering enterprise that engaged in insurance fraud, securities fraud, and money laundering, among other crimes. Defrauded victims of the enterprise lost millions of dollars. For the reasons explained by the Court at sentencing, these crimes were extremely serious and he was sentenced to serve 15 years and had only served five to date.

LEGAL STANDARD

A court may not modify a term of imprisonment once it has been imposed except pursuant to statute. Under the First Step Act of 2018, a court is permitted to reduce a term of imprisonment if, after considering the factors it finds that extraordinary and compelling reasons warrant such a reduction and that such a reduction is consistent with applicable policy statements issued by the Sentencing Commission. The applicable policy statement outlines four circumstances that constitute “extraordinary and compelling reasons” and thus justify a sentence reduction. One of those circumstances is where the defendant is “suffering from a serious physical or medical condition that substantially diminishes the ability of the defendant to provide self-care within the environment of a correctional facility and from which he or she is not expected to recover. The policy statement also requires that the defendant not pose “a danger to the safety of any other person or to the community.”

DISCUSSION

Defendant is a 44-year-old man who suffers from hypertension and is overweight. He argues that these conditions place him at a high risk of severe complications in the event of a COVID-19 outbreak at the prison.

This Court in other cases has found “extraordinary and compelling reasons” warranting release to home incarceration based on serious health risks from the COVID-19 pandemic.

Although Defendant’s hypertension and weight likely place him at somewhat higher risk from COVID-19, they are relatively common conditions and Defendant is relatively young. When the parties filed their submissions, FCI Fairton appeared to have a low incidence of coronavirus infection among inmates. According to the latest information from the BOP, however, FCI Fairton has recently experienced an outbreak, with 97 inmates testing positive for COVID-19.

Despite the outbreak at FCI Fairton, the Court did not find “extraordinary and compelling reasons” that warrant Defendant’s release. Even if there were such reasons, the Court cannot conclude that release to home confinement now — approximately five years into a 15-year sentence — is justified based on consideration of the factors set forth in the statute.

The statutory purposes of specific deterrence and protecting the public from further crime, in addition to just punishment, respect for the law, and general deterrence, require Defendant to serve a substantial part of the sentence imposed by the Court.

For the foregoing reasons, Defendant Zemlyansky’s motion for compassionate release pursuant was denied.

ZALMA OPINION

A sentence of 15 years is only assessed upon a very serious insurance criminal. There is no question that Defendant Zemlyansky was a serious criminal who received a serious sentence. Just because he is fat and like most fat people has hypertension does not change the fact that he deserved to spend his time in prison to fulfill the statutory purposes of the criminal law. He was justly punished and that punishment may deter others. To allow the existence of a pandemic to allow him to avoid his just punishment defeats the purpose of the criminal law. He needs to, and will, serve his sentence.


© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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1 Response to Pandemic or not – Serious Insurance Fraud Criminal Must Serve the Sentence

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