June 19, 2006
THREE SISTERS SENTENCED, ONE TO PRISON,
FOR DEFRAUDING STATE INSURANCE AGENCY
Attorney General J. Joseph Curran Jr. announced today the sentencing
all three sisters convicted earlier this year
in a massive scheme to defraud the Maryland Automobile Insurance
Fund ("MAIF")of nearly $65,000. Jane Gnacyk, 46, of New
Cut Rd. in Severn, Mary Ellen Webster, 37, of Wise Avenue in Pasadena
and Linda Lunghi, 35, of Freedom Drive, Glen Burnie, all had earlier
pled guilty before the Honorable Paul Goetzke, Anne Arundel Circuit
Court, on January 9, 2006. Judge Goetzke sentenced Gnacyk - the
ringleader - to two years in prison, Lunghi, a sister, to one year
of home detention and Webster, another sister, to six months in
home detention. All three defendants were also ordered to repay
the money to MAIF, and to serve five years of supervised probation.
The sisters admitted stealing $64,912 from MAIF between 1994
and 2003. Defendant Gnacyk was, at all relevant times, employed
as an Adjuster in the Claims Department at MAIF. In that capacity,
she had authority to approve claims for payment and to issue
the payments to claimants without obtaining a supervisor’s
approval, in amounts that increased over the more than 20 years
that she worked at MAIF.
processing claims filed in legitimate accidents, Gnacyk would
add to MAIF’s computerized loss records the
names of fictitious claimants, and then turn around and issue payments
or drafts to these phantom claimants, using names identical or
similar to those of her sisters, their husbands and their children.
She was always careful to not exceed her authorization limits,
so no one would question what she was doing. She would also note
addresses for these phantom individuals which were either identical
or similar to those of her co-conspirators. She did this 24 times,
in 11 accident files. Fifteen of the checks were in the name of
(or similar to the name of) co-defendant Linda Lunghi, Michael
Lunghi, Linda’s husband, or their minor children. The Lunghi
payments totaled $42,762.50 . Seven of the fraudulent drafts were
issued in the names of or similar to the names of co-defendant
Mary Ellen Webster or her minor children. The Webster payments
totaled $17,150. The two remaining fraudulent payments were issued
by Gnacyk in the names of nonexistent people, not her two sisters,
for another $5,000.
scheme was uncovered by MAIF as a result of an internal audit,
in Gnacyk’s termination and referral of the matter
to the Attorney General’s Criminal Investigations Division.
The Maryland State Police assisted in the investigation.