Carole Swan, the former Chelsea selectwoman facing federal extortion and tax fraud charges, had been receiving around $50,000 annually from federal workers compensation, according to documents obtained by the Kennebec Journal through a public records request.

It was one of a number of payments Swan has received since she suffered a right shoulder-upper arm injury while employed by the U.S. Postal Service in November 1997, according to court documents filed in her case.

Additional Photos

Carole Swan Staff photo by Joe Phelan

Now the federal government is seeking to have at least $150,000 of that money returned as part of the case against her. That is the amount she received between Aug. 1, 2008, and Feb. 29, 2012, the day she was indicted on federal fraud charges.

It is not clear from the public records whether Swan continues to receive federal compensation, though a document received through the records request says $50,639 is her “current salary.”

She is accused of extorting money from a town contractor while she was a Chelsea selectwoman and of fraudulently inflating the cost of a road project awarded to her husband, Marshall Swan, as well as fraud charges relating to income tax returns and the federal worker compensation benefits.

Swan, 54, who testified under oath in federal court in December that she was illiterate except for being able to read names and numbers, had worked previously as a rural carrier assigned to the Gardiner Post Office. She worked there from November 1982 until November 1997, when she transferred to the New Gloucester Post Office, according to Thomas P. Rizzo, a spokesman for the U.S. Postal Service.
The Kennebec Journal sent a public records request Dec. 10, 2012, to the Postal Service for details about Swan’s employment there. While the Jan. 16 response to the records request indicates Swan is employed at the New Gloucester Post Office, Rizzo said local Postal Service records say Swan’s employment ended July 31, 2008.

“Once an employee leaves employment with the Postal Service, we no longer play any role in the processing of payments,” Rizzo said.

The U.S. Department of Labor Office of Workers’ Compensation Program office monitors and pays employees in northern New England, he said. The Postal Service reimburses the program in what is known as “charge-back billings,” as do other federal agencies, Rizzo said.

“While the charge-back may show in our records, it should not be considered an active-duty status,” Rizzo said of Swan’s employment.

Four of the 17 charges in the federal indictment against Swan accuse her of making false statements on applications to collect that federal workers’ compensation money in July 2008, April 2009, May 2010, and May 2011. Swan has denied those charges and all the others brought by a federal grand jury a year ago.

Swan’s attorney, Leonard Sharon, would not comment.

Swan signed a sworn statement in which she denied working for any employer or being self-employed for the 24 months prior to July 2008 and for several years afterward, according to the federal indictment. “I do not work. I cannot work. I cannot even clean my own house or blow-dry my hair,” she wrote in May 2010.

On statements in April 2009, May 2010 and May 2011, Swan said she volunteered 1 1/2 hours every other week as selectwoman for the town “when in truth and in fact, as she well knew, she failed to report her ownership interest and her active participation in the operation of Marshall Swan Construction and a harness horse racing business, and her activities on the Board of Selectmen for the town of Chelsea,” according to documents filed by the prosecutor, Assistant U.S. Attorney Donald Clark.

Court documents say the Federal Employees’ Compensation Act “provides compensation for loss of earnings based on the difference between the employee’s ability to earn wage after an injury and the wages the employee earned at the time of injury.” Those documents say Swan, who claimed to have “a permanent total disability,” received between $3,288 and $3,458 every 28 days between August 2008 and the February 2012 indictment.

Further contradicting Swan’s claims that she didn’t work, town records show that Swan received $5,000 in July 2009, July 2010, and July 2011 for her work as an assessor for the previous fiscal years, according to Stephen Langsdorf, attorney for the town of Chelsea. The selectmen in Chelsea function as assessors as well.

Langsdorf said Swan also received an additional $2,104 from the town in July 2009 for unspecified reasons.

Informed of the worker’s compensation Swan had received from the federal government, Langsdorf said, “I was surprised to hear she was on total disability.

“I am not aware of the nature of injuries, but from interacting with her at a number of meetings, she certainly appeared to have work capacity,” Langsdorf said.

Swan is also accused of underreporting the hours she worked as selectwoman during those years and, in 2011, of failing to report $17,000 that she extorted or attempted to extort from Frank Monroe Construction, according to filings by Clark.

A trial is not scheduled yet, and a number of pretrial motions regarding the charges against Carole and Marshall Swan, are under consideration by U.S. District Court Chief Judge John A. Woodcock Jr.

Betty Adams — 621-5631
badams@centralmaine.com