The former manager of a publicly-funded state program and a woman who aided him admitted Wednesday that they defrauded it of more than $4.5 million, according to a statement from the US Attorney’s Office.

Harry Pizutelli, 64, of Edison, and Maritza Flores, 45, of Toms River, pleaded guilty to conspiracy to commit healthcare fraud, the office said. Flores also pleaded guilty to tax evasion.

Pizutelli was the manager of the New Jersey Traumatic Brain Injury (TBI) Fund and was responsible for its day-to-day operation, investigators said. He supervised, managed, and oversaw the process by which third-party vendors were paid for services rendered to eligible TBI Fund patients.

The TBI Fund is a publicly funded program run by the New Jersey Division of Disability Services, a component of the New Jersey Department of Human Services. It provides residents who have suffered a traumatic brain injury with services and support when funding from insurance, personal resources, or other programs is unavailable to meet their needs, officials said.

After a prospective patient applies for services, fund personnel review the application and, if approved, the patient is authorized to secure designated services from a third-party vendor, authorities said. Once a patient receives approved services, the vendor or service provider submits an invoice to the TBI Fund for payment. When an invoice is received, fund personnel review the invoice to ensure that the patient had been approved to receive the services. If the invoice is approved, an internal payment voucher is generated, authorized by TBI Fund personnel, and then submitted to the New Jersey Department of the Treasury for payment, which issues a check directly to the vendor.

From 2009 through June 2019, Pizutelli, Flores, another person charged in the conspiracy, C.R. Kraus, and others conspired to defraud the TBI Fund by misappropriating more than $4.5 million in fraudulent vendor payments for services that were never actually provided, federal prosecutors said. Kraus’ charges were still pending Wednesday.

Pizutelli orchestrated the distribution of fraudulent vendor payments to Flores, Kraus, and others by creating and processing false invoices and internal payment vouchers, the office said. He created them to give the appearance that Flores, Kraus, and others had provided approved services to eligible patients when, in fact, they had not done anything. Pizutelli then approved and transmitted the internal payment vouchers.

Pizutelli also created the fraudulent payments to maintain and further romantic and/or sexual relationships with Flores and other conspirators, according to the statement. He paid more than $940,000 in fraudulent distributions to Flores and more than $3.245 million in fraudulent distributions to Kraus, which they used for their own personal benefit, officials said. Flores and Kraus also evaded the payment of substantial amount of income taxes by lying on their federal income tax returns and significantly underreporting the income they had received in the scheme.

The trio was charged in January 2021.

Flores’ attorney Aidan P. O’Connor said she “regrets and takes responsibility for her involvement in this matter.” An attorney for Pizutelli could not be reached.

Sentencing for Pizutelli was scheduled for May 8, 2023, and May 9, 2023 for Flores, the office said.

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Chris Sheldon may be reached at csheldon@njadvancemedia.com.

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