Former Postal Worker Convicted of Stealing Nearly $1 Million in Tax-Free Federal Disability Benefits
Friday, September 11, 2026 - Earlier today, a federal jury in Central Islip convicted Luann Middleton, a former United States Postal Service (USPS) employee, of wire fraud in connection with her repeated submission of false workers compensation forms to the United States Department of Labor (DOL), in which she claimed total disability, and thereby received approximately $40,000 per year in federal workers’ compensation benefits for nearly 25 years. The verdict followed a four-day trial before United States District Judge Gary R. Brown. When sentenced, Middleton faces up to 20 years in prison, as well as financial penalties.
Joseph Nocella, Jr., United States Attorney for the Eastern District of New York, and Matthew M. Modafferi, Special Agent in Charge, United States Postal Service, Office of Inspector General, Northeast Area Field Office (USPS-OIG), announced the verdict.
“For more than 20 years and until her lies caught up to her, the defendant refused to come to work and instead collected tax-free disability benefits for a highly-exaggerated injury,” stated United States Attorney Nocella. “Our Office and the Administration has made it a priority to hold accountable those who exploit government benefits programs for personal gain and steal funds that are designated for workers who truly need them.”
Mr. Nocella expressed his appreciation to the United States Postal Service Office of the Inspector General (USPS-OIG) and the United States Department of Labor (DOL) for their assistance with the case.
As proven at trial, in August 1997, Middleton, who was in her mid-forties, claimed that she had sustained an injury to her lower back while performing her duties as a postal clerk. Middleton submitted a claim for compensation to the DOL and began receiving workers’ compensation benefits approximately three months later. Middleton briefly returned to work in a limited duty capacity in February 1999, after a medical doctor found that she was in fact capable of working; but then claimed she had a recurrence of her back injury, which rendered her totally and permanently disabled. She again began receiving workers’ compensation benefits – roughly two-thirds of her annual salary, tax-free – from the DOL. Between November 1997 and September 2022, Middleton regularly submitted medical evaluations and records to the USPS and the DOL claiming that she was incapable of returning to work, and that she was totally disabled. The evaluations claimed, for example, that Middleton could sit, stand, walk, bend, lift and reach above her shoulders for zero hours and could not participate in any physical activities because of her excruciating back pain.
However, the investigation revealed that between October 2015 and March 2022, Middleton engaged in numerous physical activities, including cleaning out a garage, sitting through a movie for more than two hours, standing for more than one hour at a cookie decorating class, climbing stairs and retail shopping. Middleton was observed, and captured on video footage, carrying groceries and laundry bags, lifting and reaching for objects at heights she claimed she could not reach, bending to the floor to retrieve items, and hoisting a bag of potting soil from the bottom of her shopping cart into her vehicle. Records from USPS and DOL indicate that Middleton received more than $900,000 in fraudulent workers’ compensation benefits as the result of her claimed physical limitations.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (Fraud Division). The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.
The government’s case is being handled by the Criminal Section of the Office’s Long Island Division. Assistant United States Attorneys Charles P. Kelly and Ashlyn Miranda are in charge of the prosecution, with the assistance of Paralegal Specialist Samantha Schroder, Legal Assistant Danielle Rompel, and Automated Litigation Specialist Michael Compitello.
The Defendant:
LUANN MIDDLETON
Age: 72
Glen Cove, New York
E.D.N.Y. Docket No. 25-CR-339 (GRB)
Contact
John Marzulli
Denise Taylor
United States Attorney’s Office
(718) 254-6323
Source: U.S. Attorney's Office, Eastern District of New York
