Former U.S. luxury restaurateur jailed for fraud

NEW YORK (Reuters) - The former vice president of a luxury U.S. restaurant chain with outlets in New York, London, Hong Kong and Venice was sentenced to up to four-and-a-half years prison on Monday for making false insurance claims.

Dennis Pappas, 60, the former vice president of Cipriani USA, which operates the Rainbow Room restaurant in Manhattan, was ordered to serve a minimum 18 months prison and ordered to pay more than $1 million in restitution.

In a deal with prosecutors, Pappas had pleaded guilty on May 2 to second-degree insurance fraud.

From 2000 until April 2006, Pappas claimed he was disabled and unable to work due to a heart condition, the Manhattan District Attorney's office said in a statement.

But during that period, he was employed at Cipriani, where he climbed the ranks to vice president. While receiving disability payments from various insurance companies, Pappas also received a combined salary of $891,855 from Cipriani.

Pappas was also given use of a $5,750 per month apartment and a large sports utility vehicle.

He was ordered to pay $639,000 to Custom Disability Solutions, $179,000 to Cigna Life Insurance Company of New York, $109,000 to MetLife Insurance Company and $90,000 to the U.S. Social Security Administration.

In an unrelated case, Pappas was convicted in 1998 in Brooklyn federal court of income tax evasion and charges stemming from an extortion and pension fraud scam, the District Attorney's office said. Federal prosecutors said at the time Pappas had laundered money for the Colombo crime family.