Arrests for July 2005
These arrests were made possible through the cooperation of the Frauds Bureau, law enforcement, the insurance industry and the public.
To report suspected incidents of insurance fraud, call 1-888-FRAUDNY
CAUGHT!
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GUILTY
Jerome Williams, an unemployed upstate resident, pled guilty on 7/21/05 to reckless endangerment in the 1st degree and insurance fraud in the 2nd degree. After making arrangements with the owner of a residence in Albany, he set fire to the house for a cut of $5,000 from the insurance settlement that the homeowner hoped to get from The Hartford Insurance Company. He faced up to 25 years in prison but he accepted a plea bargain for a 15-year sentence in return for his testimony against the homeowner. He is scheduled to be sentenced on 9/16/05. The investigation of the homeowner is still being conducted by the Frauds Bureau and the Albany Police Department.
Leslie L. Valastro of Northumberland, NY, pled guilty on 7/6/05 to insurance fraud in the 3rd degree and criminal possession of stolen property in the 3rd degree. Valastro reported that he left his 1997 Nitro boat near Whitehall, NY. He filed a $6,500 claim with State Farm Insurance Company stating that his boat and a Mercury 150 horsepower motor from a 2004 boat were stolen. However, he subsequently reported that six weeks after the theft he got a call from the police informing him that the boat had been found, stripped and sunk, in Vermont. Both the New York City and Vermont Police Departments state that neither agency contacted Valastro. An investigation conducted by the Frauds Bureau jointly with those two Police Departments led to the arrest on 2/17/05.
- NO-FAULT FRAUD
Arrested on 7/20/05
Charged with insurance fraud
A New York City man was charged with participating in a staged accident and receiving medical treatment for nonexistent injuries under the no-fault portion of his auto insurance coverage. Two other suspects in this case were also arrested – one on 7/12/05 and the second on 6/29/05. An investigation by the Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad led to the arrests.
- ARSON
Arrested on 7/20/05
Charged with insurance fraud in the 3rd degree
At 10:00 p.m. on 1/10/05, the New York City Fire Department responded to a vehicle fire in the Bronx. The incident was referred to the Fire Marshals for an Origin and Cause examination and the fire was determined to be incendiary. The vehicle was identified as a 2001 Mitsubishi Galant. Further investigation revealed that the car had been reported stolen to the Yonkers Police Department on 1/11/05 at 11:23 a.m. by its owner, a New York City Police Officer. The Frauds Bureau conferred with Supervising Fire Marshal Stephen Stepanaitis and was informed that the Yonkers Police Department, the jurisdictional law enforcement agency in this case, had been notified. Therefore, all participating investigative agencies determined that the matter would be referred to the Westchester County DA’s Office for prosecution. The Frauds Bureau conferred with ADA Gregory Badikian and subsequently provided him with copies of all interviews, Examinations Under Oath, the theft affidavit and all other documents relevant to the investigation. In addition, the Frauds Bureau obtained necessary documentation from State Farm Insurance Company’s Special Investigations Unit, which had insured the car in question. The arrest was the result of the joint efforts of the Frauds Bureau, the Yonkers Police Department, the New York City Fire Marshals and State Farm.
- NYS EMPLOYEES CAUGHT
Arrested on 7/19/05
Charged with grand larceny in the 2nd and 3rd degrees, insurance fraud in the 2nd and 3rd degrees, criminal possession of a forged instrument in the 2nd degree, criminal possession of stolen property in the 3rd degree and falsifying business records in the 1st degree
A six-month joint investigation by the Frauds Bureau, the Bronx DA’s Office and the New York State Inspector General’s Office led to the arrest of 16 New York State employees. Between December 2002 and April 2005, they allegedly submitted more than $600,000 in claims for medical treatments they never received. They are also accused of pocketing $389,423 paid out on those claims. The defendants were employed by the New York State Office of Mental Retardation and Developmental Disabilities or the State University of New York and were covered under The Empire Plan, the health insurance program for New York State workers. The investigation began when the insurer discovered that the treatment code on one of the claims was incorrect and contacted the doctor to inform her. The doctor told the insurer that the person who submitted the claim was not one of her patients.
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NO DENTAL WORK FROM JAIL
Arrested on 7/15/05
Charged with insurance fraud in the 4th and 5th degrees, grand larceny in the 4th degree and petit larceny
While an employee of Excellus Health Plan, the defendant in this case filed claims for services purportedly received by her husband from a local dentist on 7/14/04 and 8/12/04. On 1/18/05, she submitted another claim stating that her son Ryan had received dental services. However, an investigation by the Frauds Bureau revealed that all three claims were fraudulent. As a matter of fact, the defendant’s husband was incarcerated during the time the dental work was allegedly performed.
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DELIVERY
Arrested on 7/12/05
Charged with insurance fraud in the 3rd and 5th degrees, grand larceny in the 4th degree, petit larceny and falsifying business records
Following a work-related injury on 2/8/02, this suspect began collecting workers’ compensation benefits. On several occasions from that time until his arrest, he signed documents denying that he had returned to work. However, during an investigation by the Frauds Bureau and the State Insurance Fund, he was videotaped working as a driver/deliveryman. As a result of his scheme, he collected more than $8,000 in benefits to which he was not entitled.
PRIOR SUPPLEMENTS
JUNE 2005
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STAGED ACCIDENT
Arrested on 6/27/05
Charged with grand larceny in the 4th degree, falsifying business records in the 3rd and 4th degrees, insurance fraud in the 5th degree and conspiracy in the 5th degree
An investigation by the Frauds Bureau led to the arrest of a Staten Island woman who, with others, some of whom were apprehended while some were not, was charged with staging an accident and submitting a fraudulent Police Accident Report. She later filed a fraudulent no-fault claim with General Assurance Company for personal monetary gain.
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CAR FIRE
Arrested on 6/20/05
Charged with Arson in the 3rd degree, grand larceny in the 3rd degree, insurance fraud in the 3rd degree, falsely reporting an incident and making a punishable false written statement
On 5/1/05 at about 11:00 p.m. the NYPD responded to a vehicle fire in Queens. The Police Department referred the incident to the New York City Fire Marshals, who, after an investigation and examination of the vehicle, a 2002 Isuzu Rodeo, deemed the fire incendiary. An investigation by the Frauds Bureau and the Fire Marshals resulted in the arrest of this defendant who confessed that he arranged to have the car burned for the insurance settlement.
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ADD ANOTHER FRAUDSTER
Arrested on 6/20/05
Charged with insurance fraud
A Bronx man was arrested as a result of an ongoing investigation by the Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad into a series of staged accidents. Seven suspects have been previously arrested in connection with this investigation.
MAY 2005
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SENTENCED
Leonard Friscia, Josephine Giaquinto and Ivan Westbrook, the president and two partners, respectively, of a bogus dental insurance business they operated in eight New Your counties, were sentenced on 5/20/05 in U.S. District Court, after pleading guilty to federal charges of making false statements relating to health care matters in violation of Section 18 of the U.S. Code. Each will spend three months in federal prison, have three months of home incarceration, three years of supervised release and will pay a total of $42,000 in restitution. In the spring of 2001, the Insurance Department’s Consumer Services Bureau began an investigation based on a complaint by an insurance agent from Orange County, NY. The agent reported that he had sold a number of the dental company’s insurance policies to business owners for their employees and also to individuals. Several of the policyholders had begun to complain that their claims were not being paid. Early in the investigation, the Consumer Services Bureau learned that the company, Preferred Dental Care, was not licensed to do business in New York State and the case was referred to the Frauds Bureau for criminal investigation. The investigation revealed that these three individuals collected more than $1 million in premiums from unwitting customers in Putnam, Ulster, Rockland, Dutchess, Orange, Schenectady, Sullivan and Albany Counties. In Albany County alone, there were about 150 individuals defrauded. The three were arrested on 9/7/04 on New York State charges and on 1/18/05 on federal charges. Sentencing on the State charges is scheduled for 8/11/05. The Insurance Department’s Health and Consumer Services Bureaus, as well as the U.S. Postal Inspector’s Office, provided assistance in the investigation.
- REVOKED BROKER
Arrested on 5/25/05
Charged with forgery in the 2nd degree, criminal possession of a forged instrument in the 2nd degree, criminal possession of forgery devices, scheme to defraud in the 1st degree, attempted offering of a false instrument in the 5th degree, insurance fraud in the 5th degree and possession of stolen property in the 5th degree
A former insurance broker, whose license was revoked by the Insurance Department in 1998 for selling fraudulent auto insurance policies, was accused of soliciting motorists at gas pumps near his "brokerage" business by handing out brochures that said "No Matter How Many Points We Insure All," "Cancelled Policies Replaced" and "Immediate ID Cards." He sold allegedly fraudulent auto ID cards and registrations, some of which were purchased by individuals with suspended registrations or cancelled insurance policies. During the investigation by the Frauds Bureau, the Queens DA’s Office, the NYPD’s Auto Crime Division and the DMV, the defendant sold a fraudulent insurance police to an NYPD undercover officer for $500. He issued an Interboro Mutual Indemnity Insurance Company ID card. However, that insurer has been in court-ordered rehabilitation since April 2004 and is no longer writing new business. A search warrant executed at the defendant’s home recovered fraudulent New York State temporary certificates of registration, fraudulent New York State inspection and registration stickers, 61 fraudulent North Carolina DMV 30-day temporary licenses (known as tags), fraudulent U.S. Military identification cards, fraudulent Interboro Mutual insurance cards, as well as computers and disks with templates to create the fraudulent documents.
- FRAUDULENT POLICE REPORT
Arrested on 6/5/05
Charged with insurance fraud in the 3rd and 5th degrees and conspiracy
A Brooklyn man and three others also arrested were charged with submitting a fraudulent Police Accident Report and receiving more than $3,000 in no-fault medical benefits for nonexistent injuries. These arrests were made as a result of the joint efforts of the Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad.
