U.S. Attorney's Office/Eastern District of Texas:
TYLER (KYTX) – A 55-year-old Longview, Texas lawyer has been sentenced to federal prison for mail fraud in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Steven Rushing pleaded guilty on Feb. 15, 2013 to mail fraud and was sentenced to 41 months in federal prison today by U.S. District Judge Michael H. Schneider. Rushing was also ordered to pay restitution in the amount of $929,076.29.
According to information presented in court, beginning in January 2007, Rushing devised a scheme to defraud insurance companies and health care providers using the United States mail to execute the scheme. Rushing's scheme involved providing legal representation to clients injured in accidents. Rushing negotiated settlements with civil defendants or a potential civil defendant's insurance provider. While negotiating final settlement amounts, Rushing would represent to his clients and the insurance providers that he would use a portion of the settlement proceeds to pay for some, or all, of his client's outstanding medical bills. Once Rushing received the settlement check, he would deposit it into his account and provide his client with a "Disclosure Statement" detailing the manner in which the total settlement was to be distributed. Rushing would give a check to the client for the "client net" agreed upon amount and execute checks payable to his client's medical providers. However, Rushing would not actually send the medical providers their checks, instead converting that portion of the settlement proceeds for his own personal use. For instance, Rushing admitted that on June 20, 2011, he sent a letter to Farmers Insurance representing that he would use funds from a proposed settlement to pay off "any and all hospital, health insurance, and/or Medicaid/Medicare liens" in order to secure a specific settlement in the amount of $6,836.00, when in fact, Rushing never intended to pay the liens.
This case was investigated by the Longview Police Department and the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Jim Noble.