Arrests for June 2006
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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SENTENCED
Lori Shanahan of Troy, NY, was sentenced to a term of two-to-six years in state prison on 6/20/06 for diverting more than $105,000 in insurance payments and submitting fraudulent claims for payment by the dental office where she was employed. The dentist was almost ruined as many patients left his practice believing he had put their insurance payments to his personal use. She was arrested in October 2005 and charged with five felony counts including identity theft, larceny and falsifying business records. An investigation by the Frauds Bureau led to her arrest.
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INDICTED
The owner of a Gloversville insurance agency was indicted on 6/23/06 by a Fulton County grand jury on charges of offering a false instrument for filing in the 1st degree, falsifying business records in the 1st degree and forgery in the 2nd degree. He collected insurance premiums from numerous customers but failed to forward the money to an insurer. The investigation began in the summer of 2005 when several of the suspect’s clients complained to the DMV that their insurance had been cancelled for nonpayment of premiums in spite of the fact that they had made regular payments to the agent. He was arrested on 1/24/06, the day his agency was raided by the Frauds Bureau, the DMV and the Gloversville Police Department.
- FRAUDULENT CERTIFICATES
Arrested on 6/30/06
Charged with violation of the Workers’ Compensation Law
On two occasions, 4/26/06 and 5/8/06, the defendant in this case presented to the State Insurance Fund two Certificates of Insurance as proof that the required workers’ compensation insurance coverage was in place for his construction business. In fact, no such coverage existed. The Frauds Bureau joined forces with the Fund and the Suffolk County DA’s Office in this investigation.
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NO HIT
Arrested on 6/27/06
Charged with insurance fraud in the 4th degree and falsifying business records in the 1st degree
An joint investigation conducted by the Frauds Bureau, the Monroe County Sheriff’s Department and Selective and GEICO Insurance Companies resulted in the arrest of a Rochester car salesman. On 2/21/06, a deputy sheriff driving a marked patrol car with emergency lights flashing stopped this suspect who was driving a car with a New York State Dealer plate. As the deputy was exiting, a pickup truck approaching the patrol car slowed and a vehicle behind the pickup swerved to avoid hitting the slowing pickup. As the vehicle swerved, it slammed into the patrol car, causing damage and minor injuries to the deputy. The suspect subsequently filed a no-fault medical and lost wage benefit claim with Selective Insurance Company stating that after the patrol car was hit, it rear-ended his car causing injuries to him and damage to his car. However, an investigation at the scene by Sheriff’s Department investigators and technicians revealed that the Patrol car never struck the suspect’s car.
- MUG SHOT
Arrested on 6/20/06
Charged with insurance fraud in the 3rd degree
Following an investigation by the Frauds Bureau and the Suffolk County DA’s Office, a Queens photographer was arrested and accused of submitting fraudulent invoices to St. Paul Travelers Insurance Company in support of his burglary claim filed in connection with a commercial insurance policy.
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ENHANCED ESTIMATE
Arrested on 6/17/06
Charged with insurance fraud in the 4th degree and falsifying business records in the 1st degree
The defendant in this case submitted an allegedly altered estimate for replacement of a storm door that was blown off her home during a wind storm. An investigation by the Frauds Bureau uncovered evidence that she enhanced the estimate from $1,690 to $2,690.
- WORKERS’ COMP FRAUD
Arrested on 6/16/06
Charged with violation of the Workers’ Compensation Law
An unemployed Suffolk County man presented an audit form to AIG Insurance Company that contained materially false information as to his employment status. As a result, he received $8,400 in workers’ compensation benefits to which he was not entitled. His arrest was the result of an investigation by the Frauds Bureau and the Suffolk County DA’s Office.
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ALTERED ACCIDENT REPORT
Arrested on 6/15/06
Charged with insurance fraud and conspiracy
The suspect in this case was arrested and charged, along with two others previously arrested, with altering a legitimate Police Accident Report. He received more than $5,000 in medical treatment under the no-fault portion of his auto insurance. The Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad conducted this investigation jointly.
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DATED
Arrested on 6/15/06
Charged with insurance fraud and attempted grand larceny
This defendant stated to the NYPD and to his insurer that his car was stolen. He claimed that he had last driven the car on 4/4/06 in Queens. However, an investigation by the Frauds Bureau and the NYPD revealed that the car had been recovered in the Bronx on 4/3/06.
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ALL IN THE FAMILY, AGAIN
Arrested on 6/13/06
Charged with insurance fraud, falsifying business records, grand larceny, conspiracy and corruption
Five members of a family of seven previously accused of participating in an elaborate insurance scam were indicted for the second time in three months. All seven family members were arrested in March on similar charges. They have been accused of staging hundreds of auto accidents over 15 years targeting elderly and drunken drivers, and then filing fraudulent insurance claims. A two-year investigation by the Frauds Bureau and the Albany County DA’s Office brought about the arrest on 3/15/06 of a well known Albany area prizefighter and his wife, father, sister, brother and sister-in-law. The matriarch of the family was arrested the following day. This recent indictment included the two brothers, their wives and their father.
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RATE EVASION
Arrested on 6/7/06
Charged with insurance fraud
As a result of a joint investigation with the Frauds Bureau, the NYPD’s Document Fraud Squad and the Pennsylvania Prosecutor’s Office, the defendant in this case was arrested on a warrant issued by the State of Pennsylvania charging him with insurance fraud/rate evasion. A second defendant suspected in this case was arrested on 6/6/06 and a third on 5/8/06 in this ongoing investigation.
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CARS REPAIRED, MAYBE NOT
Arrested on 6/6/06
Charged with insurance fraud in the 4th degree and petit larceny
On 2/22/06, a GEICO Special Investigations Unit Investigator and a mechanic at a local used car sales lot met with the Frauds Bureau. The mechanic reported that while employed at the used car lot, he repaired a car using a blowtorch and bending the damaged parts into place. Then new replacement parts were ordered to complete the job. According to the mechanic, when the parts arrived, the owner of the lot (who is the defendant in this case) instructed him to return the car to its original state of disrepair. Then, based on the damage and the cost of the new parts, GEICO’s adjuster gave an estimate for the repair and GEICO paid the defendant a total of $526.75. He then instructed the mechanic to repair the damage as he had done before and the new parts were returned for refund. Following an investigation by the Frauds Bureau, the defendant was arrested and charged.
PRIOR SUPPLEMENTS
MAY 2006
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OUCH!
Arrested on 5/30/06
Charged with insurance fraud in the 4th degree, falsifying business records in the 1st and 2nd degrees, scheme to defraud and criminal diversion of prescription medications in the 4th degree
A joint investigation by the Frauds Bureau and the Suffolk County DA’s Office led to the arrest of a Riverhead dentist who was arraigned on 5/31/06 on a 14-count grand jury indictment. The investigation uncovered evidence that between 12/04 and 3/05, the dentist billed MetLife Insurance Company and the benefit funds of the Civil Service Employees Association and Local 1199 of the Service Employees International Union Healthcare workers for fluoride treatments, teeth cleanings, x-rays and fillings, all services that he did not provide. He also wrote the alleged dental procedures into the patients’ medical charts. In addition, the suspect made demands on his office manager and dental assistant that they obtain prescriptions for Valium for his personal use for which he paid both employees’ co-payment expenses. According to the Suffolk County DA’s Office, it was the "alert monitoring of insurance documents by the affected patients" that led to the charges against the dentist.
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IDENTITY THEFT
Arrested on 5/30/06
Charged with criminal impersonation in the 2nd degree, criminal use of an access device in the 1st degree, identity theft and unlawful possession of personal identification
Using the personal identification he had stolen from the victim of this fraud, the defendant in this case posed as a representative of the victim and applied for a vehicle title and temporary registration in Pennsylvania. Her arrest was brought about by an investigation by the Frauds Bureau and the NYPD’s Fraudulent Document Squad.
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ALTERED ACCIDENT REPORT 2
Arrested on 5/26/06
Charged with insurance fraud and falsifying business records
An investigation by the Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad led to the arrest of a Bronx man accused of insurance fraud and falsifying business records. The defendant, acting in concert with another individual also arrested, falsified a valid Police Accident Report and received treatment costing more than $15,000 for nonexistent injuries under no-fault coverage.
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BURIED TREASURE
Arrested on 5/22/06
Charged with insurance fraud in the 3rd degree, grand larceny in the 3rd degree, making a punishable false written statement and falsely reporting an incident in the 3rd degree
This suspect reported to the Town of Tonawanda Police Department that his 2001 Chevrolet S/10 pickup truck had been stolen from his place of business in Tonawanda. He subsequently filed a claim with Selective Insurance Company and on 5/17/06 was paid $15,155 for the loss. However, at the request of the Tonawanda PD, the Frauds Bureau assisted in an investigation that revealed that in September 2005, the defendant paid an associate $700 to make his car "disappear." The associate used the defendant’s backhoe to dig a hole large enough to completely bury the pickup, which was recovered during the investigation in Cherry Creek, Chautauqua, NY. The investigation is continuing into the activities of the defendant’s associate.
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BROKER FRAUD
Arrested on 5/17/06
Charged with forgery in the 2nd degree, possession of a forged instrument and identity theft
Following an investigation by the Frauds Bureau and the NYPD, a former insurance broker was arrested on charges that he stole the identities of his clients in order to fraudulently register vehicles.
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ALTERED ACCIDENT REPORT 3
Arrested on 5/17/06
Charged with insurance fraud and conspiracy
This defendant, along with another individual also arrested, was accused of altering a legitimate Police Accident Report and subsequently received more than $5,000 in medical treatment for nonexistent injuries. The combined efforts of the Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad led to the arrests.
APRIL 2006
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MAJOR MORTGAGE FRAUD RING
Arrested on 4/25/06
Charged with criminal enterprise, grand larceny in the 1st and 2nd degrees, scheme to defraud in the 1st degree and falsifying business records in the 1st degree
An investigation by the Frauds Bureau, the AG’s Office and the New York State Banking Department led to the indictment of eight individuals in connection with a multi-million dollar residential mortgage fraud scheme. One additional suspect remains at large. The group, including two real estate attorneys, operated primarily in Queens, Brooklyn and Suffolk County. Members of the group paid others, known as "straw buyers, to pose as legitimate real estate buyers. False information about these straw buyers’ employment, income and financial assets were provided to banks in order to obtain loans. The banks were also provided with false real estate appraisal reports that often misrepresented the physical conditions of the properties, the market value of comparable properties and the identities of the individuals (members of the group) who prepared the reports. As a result, the value of individual properties was inflated by $100,000 or more. The ultimate losers were the financial institutions, which provided mortgage loans based on the fraudulent applications. An example cited in the indictment concerns a January 2004 sale of a house in Brooklyn. Although the true purchase price was $310,000, the group told the bank that the price was $450,000 and applied for a loan in that amount. The group gave the bank false information about the straw buyer that it recruited as a front man and submitted a forged appraisal report. The group then pocketed the bulk of the inflated amount and allowed the loan to go into default.
MARCH 2006
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FAKED INJURIES
Arrested on 3/23/06
Charged with insurance fraud
This suspect, while acting in concert with another individual previously arrested, sought and received $4,000 in medical treatment for nonexistent injuries under no-fault coverage. The Frauds Bureau and the NYPD’s Fraudulent Accident Investigations Squad combined efforts in this investigation.
JANUARY 2006
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STAGED ACCIDENTS
Arrested on 1/11/06
Charged with violation of Title 18 of the U.S. Code
As a result of a joint investigation conducted by the Frauds Bureau, the NYPD’s Fraudulent Accident Investigations Squad and the FBI, three individuals were arrested and accused of staging accidents.
DECEMBER 2005
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CHIROPRACTORS CAUGHT
Arrested on 12/8/05
Charged with health care fraud
Two Suffolk County chiropractors were arrested and charged with submitting fraudulent bills for chiropractic treatment when, in fact, the patients were being provided with personal trainers at a health club. The Frauds Bureau and the U.S. Attorney’s Office handled the investigation.
