UPMC Health Plan was bled of $846,819 by its own Senior Director of Claims, Ronald Larry Locy, who admitted in federal court to funneling money to two ghost employees who never worked a day.
Locy, 48, of Georgetown, Texas, stood before U.S. District Judge David Stewart Cercone and pleaded guilty to one count of embezzlement in connection with health care. The scam ran under the radar while Locy, a top claims executive, manipulated payroll and approval systems to siphon off bonuses and paychecks to phantom staff.
According to prosecutors, the ghost employees were entirely fictitious—or, in some cases, real people whose identities were exploited—yet Locy caused UPMC to issue payments totaling $846,819 for services never rendered. The fraud was tied to inflated workloads and falsified performance metrics used to justify bonuses and salary increases.
Acting U.S. Attorney Soo C. Song confirmed the plea, calling it a betrayal of institutional trust. “When someone in a position of authority weaponizes their access for personal gain, the damage extends beyond dollars,” Song said. “It undermines the entire system.”
Sentencing is set for May 24, 2016, at 11 a.m. before Judge Cercone. Locy faces up to 10 years in prison, a $250,000 fine, or both. Federal Sentencing Guidelines will weigh the severity of the crime and any prior criminal history in determining the final penalty.
The case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Robert S. Cessar. Authorities say the investigation exposed vulnerabilities in internal oversight at one of Pennsylvania’s largest health care providers.
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Key Facts
- State: Pennsylvania
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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