New York Attorney General Eric Schneiderman has charged HiRise Engineering P.C. and Matthew Pappalardo with fraud in doctoring engineering expert reports on properties damaged in Hurricane Sandy. Pappalardo allegedly had HiRise employees alter reports on properties covered under the National Flood Insurance Program to profit himself and the company. HiRise is charged with 25 counts of second degree forgery and in addition, Pappalardo is also charged with 25 counts of the unauthorized practice of engineering.
New York AG Eric Schneiderman August 1, 2016 press release:
Fraudulently altering engineering reports undermines the integrity of the entire FEMA claims process, which homeowners and families rely upon in a time of crisis. Today’s charges reveal a flagrant disregard for the well-being and safety of New Yorkers, and my office will not tolerate it… Along with our criminal investigation, my office has also released a reported calling on federal regulators and industry participants to enact reforms to ensure that the insurance claims process is more transparent, which will help protect homeowners against the alleged fraud that we have uncovered. When the next major storm hits, it’s crucial that families know exactly what kind of damage is covered by insurance, and that their claims are being handled professionally and reliably.
According to statements made by prosecutors at arraignment, after Superstorm Sandy in October 2012, HiRise, a Uniondale-based engineering firm, was contracted to perform structural engineering assessments for properties covered under the National Flood Insurance Program.
According to prosecutors, the original reports authored by the on-the-ground, subcontracted professional engineers were allegedly altered by employees of HiRise, under the direction of project manager Pappalardo.
Hurricane Sandy made landfall in 2012, devastating New Jersey and New York with tens of billions of dollars in damages. Fraudulent assessments of property damage in the superstorm by the engineering firm HiRise are now under scrutiny. In this type of litigation, engineering expert witnesses are called upon to opine on whether structural assessments and construction project estimates made by an engineering firm are accurate or fraudulent.