Bill Mercer, United States Attorney for the District of Montana, announced that during a federal court session in Billings, on Jan. 3, 2005, before U.S. District Judge Richard Cebull, Bradley Keith Clausen, 49, of Laurel, appeared for sentencing.
Clausen was sentenced to a term of:
* Prison: 2 years and 9 months
* Special Assessment: $300
* Supervised Release: 3 years
* Restitution: $100,236.05
Clausen was sentenced in connection with his guilty plea to social security fraud, medicaid fraud and making false statements to obtain Section VIII housing subsidies under the Department of Housing and Urban Development (HUD).
On Dec. 18, 1989, Clausen applied for Supplemental Security Insurance (SSI) benefits through the Social Security Administration (SSA). The SSA determined Clausen was eligible for benefits and he received monthly benefits from January 1993 through April 2002 of more than $50,000.
In order to be determined eligible for benefits and to continue to
receive benefits, Clausen had to demonstrate that he was disabled such that he was not working, was unable to engage in substantial gainful activity, and that his income and assets were below certain amounts.
By qualifying for SSI, Clausen also qualified for Medicaid benefits administered by Health and Human Services (HHS) (and its successors, Health Care Financing Administration and Center for Medicare and Medicaid Services) for the time he was eligible for SSI. Between April 1993, and September 1999, he received Medicaid benefits on 223 non-pharmacy claims and 145 pharmacy claims and from January 1993 through April 2002, Clausen secured more than $20,000 in Medicaid benefits.
On Feb. 6, 1990, Clausen applied for subsidized housing at Big Sky
Apartments through the Section VIII program HUD. He was determined to be eligible for subsidized housing and received monthly subsidies between January 1993 and April 2002 of $16,572. In order to be determined eligible for benefits and to continue to receive benefits, Clausen had to demonstrate that his income was below a certain level. In addition, to receive an additional allowance which increased his Section VIII subsidy, Clausen had to demonstrate that he was disabled.
Beginning on or about Jan. 1, 1993 and continuing until on or about April 12, 2002, Clausen reportedly concealed from SSA, HHS and HUD his true physical condition, his used car business enterprise, and his actual income, including income from his used car business
Beginning with his application for SSI benefits in 1989, and periodically thereafter, Clausen was required to report his physical condition, his work or ability to work, and his income to SSA. When his application was completed, he received a receipt notifying him of
his responsibility to notify SSA of any change within 10 days after the month in which it happens. Changes that had to be reported included if: the amount of money he received went up or down; he started or stopped work; his earnings went up or down; or his condition
On several occasions, Clausen signed similar acknowledgments that he agreed to notify the SSA if his medical condition improved or if he went to work including: Sept. 2, 1998, and March 5, 1999. In addition, on April 11, 2000, Clausen acknowledged that he needed to report any change in income within 10 days after the end of the month it occurred.
Clausen reportedly made many representations to SSA about his physical condition.
On Sept. 2, 1998, Clausen represented his physical condition had worsened; he could not work because he could not lift on his feet and he had a hard time getting around without braces; he did not walk much as a form of exercise; he was able to shop for himself with rides from friends or taking public transit; he did not have a car he could use or a driver’s license; his activities and hobbies were reading books and newspapers, attending sporting events and watching them on TV; and his arthritis was sometimes unbearable.
He also listed “bus” and “friends” as his transportation methods. On March 5, 1999, he represented that he believed he was unable to return to work; walking was getting harder all the time; exercising
was impossible due to his physical condition; other than TV, radio, telephone and reading he did not feel like doing anything else; and he drove his girlfriend’s car when able to borrow it and it had to be an automatic; and his condition had worsened twice as much since 1989.
On May 13, 1999, he represented that his condition had worsened since 1989; he could not lift his left arm above his shoulder; he was essentially homebound although he was able to walk a couple of blocks; standing was limited to 15 – 20 minutes; he had no relevant work history; he could not work at this time because he could not lift, walk distances and he was in constant pain.
Clausen reportedly made numerous statements to SSA to the effect that he could not work or did not work, including on Dec. 18, 1989, May 21, 1990, July 21, 1995, Sept. 2, 1998, March 5, 1999, May 13, 1999, and Oct. 17, 2001. Clausen also made such a statement in response to a Dec. 12, 1992, SSA request for pay stubs or a tax return. On Oct. 17, 2001, Clausen denied ever signing his girlfriend’s name on a check.
Clausen made numerous statements to SSA to the effect that he had no income other than SSI, including on Dec. 18, 1989, Feb. 27, 1990, May 21, 1990, Sept. 2, 1998, April 11, 2000 and on Oct. 17, 2001.
Beginning with his application for Section VIII subsidized housing in 1989, and periodically thereafter, Clausen was required to report his physical condition; his work; and his income to HUD. On Feb. 20, 1990, Clausen signed the initial lease agreement which required him to report if he obtained employment. Between 1993 and 2001, Clausen reportedly made 15 written representations to HUD that he was disabled; he had no occupation, business and/or employment; and he had no income other than SSI.
In contrast to Clausen’s reports, the government would reportedly prove Clausen golfed every summer from 1993 through 2002. He maintained a membership at Briarwood. He also golfed at Pryor Creek, Lake Hills and Par 3. He often took his clubs with him and golfed when he traveled to Great Falls and out-of-state for his car business.
Between 1993 and 1999 during golf season, he generally golfed at least twice a week. He had a normal golf swing. He sometimes golfed on consecutive days. He stored his clubs in his third floor apartment and carried them up and down.
From 1993 through 1999 or 2000, Clausen frequently took walks in the evening for exercise. He walked without braces. Early in the fraud period he occasionally fished. He had a vehicle, a driver’s license and he drove many types of vehicles. He did not need friends to drive him places and he did not take public transit. He attended out-of-state auto auctions about once a month and usually went by car. Clausen shopped for himself. He could lift while standing. He went out to casinos frequently.
Clausen lived on the third floor of an apartment building from 1989 to 2002. The apartment building did not have an elevator. When he moved in, he stated to the landlord that any floor would be fine.
His physical disabilities did not impact his ability to operate Quality Motors or to work at Jerry Bates Auto or Big Sky Auto Auction.
Beginning at least by 1995 and continuing through April 2002, Clausen owned, operated and profited from Quality Motors, a used car business. He bought and sold used cars.
Clausen set the business up in the name of his girlfriend, who handled much of the paperwork. On behalf of the business, Clausen: carried the checkbook and issued numerous checks to carry out the business by either forging his girlfriend’s signature or having her sign blank checks so he could fill out the rest; attended auto auctions twice a week including Big Sky Auto Auction in Billings to purchase and sell cars; took dealers out weekly in Billings; attended auto auctions out-of-state approximately once a month; arranged for financing for the vehicles bought by Quality Motors; and arranged for advertising to sell the vehicles.
On Jan. 20, 1995, his girlfriend submitted an application to the State of Montana to be a used car dealer. On that application and on at least 25 quarterly reports filed with the state through Oct. 1, 2001, Clausen was listed as an agent, driver and/or buyer and listed as having a demo or dealer license plate. When he parked at his apartment he frequently took his dealer plates in with him and parked away from the building.
Clausen profited from Quality Motors. Between Oct. 3, 1995 and April 15, 2002, $83,179 was withdrawn in cash from the Quality Motors bank account at First Bank/U.S. Bank. Beginning May 31, 1995 through April 2002, Quality Motors paid for Clausen’s membership and account expenses at Briarwood.
Beginning in 1999, Clausen began working daily for Big Sky Auto Auction in Billings and was paid.
Between 1993 and 2002, Clausen was the sole owner and only person with signature authority on a checking account at Norwest/Wells Fargo Bank. Account records show that in addition to his SSI deposits, he deposited the following amounts: 1993 – $5,511;
1994 – $11,428; 1995 – $7,703; 1996 – $7,487; 1997 – $15,847; 1998 – $11,756. Then in November of 1998, law enforcement agents interviewed an employee at Big Sky Auto Auction about Clausen and deposits subsequently went down to the following amounts: 1999 – $929; 2000 – $1,864; 2001 – $964; and 2002 – $328.
Between 1993 and 2002, Clausen had other income that was not deposited into his checking account.
Between 1993 and 2002, Clausen received income from three used car businesses: Jerry Bates Auto in Great Falls, Quality Motors, and Big Sky Auto Auction in Billings.
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