Insurance Brokers Plead Not Guilty to New Jersey Fraud

July 15, 2010

Three insurance brokers from Maryland have pleaded not guilty to charges that they bilked the city of Perth Amboy, N.J., out of more than $216,000 by collecting payments for a nonexistent wellness program for city workers.

Francis X. Gartland of Baltimore, his son-in-law Derek Johnson of Lutherville and their business partner, Thomas B. Kelleher of Parksville, appeared Tuesday in New Jersey Superior Court in New Brunswick.

The men are charged with conspiracy, theft by deception and falsifying records.

Prosecutors say they stole the funds by directing the city’s medical insurance carrier to bill an extra $15 per employee per month and pass the fees to a company they controlled that was supposed to be providing the wellness program.

The men remain free without bail.

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