Arrests for July 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
- 17 CHARGED
Arrested on 7/27/06
Charged with enterprise corruption, scheme to defraud, money laundering, larceny, grand larceny, insurance fraud, falsifying business records and offering a false instrument for filing
A 20-month investigation conducted jointly by the Frauds Bureau, the AGs Auto Insurance Fraud Unit and the NYPDs Fraudulent Accident Investigation Squad resulted in three separate indictments charging 17 people and three corporations with participation in an elaborate no-fault insurance fraud scheme. The first indictment charged three defendants, including a doctor and a medical clinic owner, for operation and control of a medical clinic in Brooklyn. The "owner on paper" was the doctor, whose specialty was physical rehabilitation. The real owner, a woman who lacks a health provider license, made the decisions about what medical services were to be provided to the patients. The clinic acquired patients using a network of "steerers" who were paid to refer patients. The steerers solicited patients by staging auto accidents and by offering the clinics services to legitimate auto accident victims. They allegedly staged the accidents by recruiting people to pose as injured pedestrians or bicyclists, or to pose as witnesses. The AG has also brought a civil case against these defendants seeking forfeiture of more than $3.9 million in the illegally gained proceeds of the scheme and has obtained a court order freezing the assets of the doctor, the clinics owner and three corporate defendants. In the other two indictments, 14 people were accused of staging accidents throughout New York City and seeking treatment of nonexistent injuries. Two Brooklyn-based management companies, both owned by the woman who secretly owned the clinic, were allegedly used to launder the funds of the enterprise. Also assisting in the investigation was the National Insurance Crime Bureau, and Allstate, American Home, AIG, American Select, GEICO, Liberty Mutual, MetLife Auto and Home, OneBeacon, Progressive Casualty, State Farm and York Claims of AIU Insurance Companies, as well as The Robert Plan Corporation.
Arrested on 7/27/06
Charged with offering a false instrument for filing in the 1st degree and committing a fraudulent practice under Section 114.01 of the Workers Compensation Law
While collecting workers compensation benefits, the suspect in this case submitted three documents to the State Insurance Fund stating he was unable to work. However, during an investigation by the Frauds Bureau, he was observed performing heavy labor at a construction site.
- ALTERED REPORT
Arrested on 7/24/06
Charged with insurance fraud and petit larceny
An investigation by the Frauds Bureau and the NYPDs Fraudulent Accident Investigation Squad led to the arrest of a Brooklyn laborer accused of altering a legitimate Police Accident Report. Using the altered Report, he sought and received more than $1,000 in medical treatment for nonexistent injuries and submitted the bills to his insurer for payment under the no-fault portion of his auto insurance.
A FIANCEE IS NOT A WIFE
Arrested on 7/20/06
Charged with insurance fraud in the 5th degree
An investigation by the Frauds Bureau and the State Police resulted in the arrest of a livery car dispatcher who was charged with two counts of insurance fraud in the 5th degree. This defendant applied for family health insurance through his employer, stating that a female companion was his wife. However, the investigation uncovered evidence that he and the woman were not married. During an interview conducted on 7/19/06 by investigators from the Frauds Bureau and the State Police, the defendant signed a sworn confession stating that he applied for the family plan because the woman was in fact his fiancée and they were living together.
Arrested on 7/19/06
Charged with insurance fraud in the 3rd degree, grand larceny in the 3rd degree and falsifying business records
A Long Island man was accused of reporting that he was injured in an auto accident that never occurred. He subsequently applied for no-fault benefits for nonexistent injuries. His arrest was the result of an investigation by the Frauds Bureau and the NYPDs Fraudulent Accident Investigation Squad.
Arrested on 7/19/06
Charged with insurance fraud in the 4th degree and attempted grand larceny in the 4th degree
On 5/12/06, a Rochester resident was involved in an auto accident, after which his car was towed to the City of Rochester Auto Pound. After retrieving the car, he reported to GEICO Insurance Company that $1,470 worth of tools had been stolen from the vehicle while it was at the Pound. In support of his claim, he submitted allegedly fraudulent receipts as proof that he purchased the tools. The Frauds Bureau, the Rochester Police Department and GEICOs Special Investigations Unit combined efforts in this investigation.
LAWYER FOR SALE
Arrested on 7/13/06
Charged with scheme to defraud
The defendant in this case, a lawyer, was arrested on charges that, while acting in concert with another person also arrested, he represented an NYPD Officer in a case involving an accident that he knew the Officer had not been involved in. The Officer was working undercover at the time. He also advised the Officer to seek treatment for nonexistent injuries. The investigation was conducted jointly by the Frauds Bureau and the NYPDs Fraudulent Accident Investigation Squad.
- WHOS ANSWERING THE PHONE?
Charged with perjury in 1st degree, insurance fraud in the 3rd degree and committing a fraudulent practice under Section 114.01 of the Workers Compensation Law
On 4/7/04, while employed as a taxi driver, the defendant in this case sustained an injury and began collecting workers compensation benefits. An investigation was initiated after the State Insurance Fund submitted a report of suspected fraud to the Frauds Bureau. The investigation revealed that the defendant was actively engaged in a busy landscaping business that he co-owned with his wife. At this time in the investigation, the State Insurance Fund, having paid out more than $4,000 in benefits, requested that the Workers Compensation Board have the defendant appear at a hearing, where he provided sworn testimony that he was unable to do work of any kind. He further testified that his involvement in his wifes business was limited to answering telephones. In fact, he had been observed on video tape engaging in all aspects of the lawn-care service, including heavy manual labor.
Arrested on 7/6/06
Charged with grand larceny and insurance fraud
An investigation conducted jointly by the Frauds Bureau and the NYPDs Fraudulent Accident Investigation Squad led to the arrest of a broker who collected more than $200,000 in premiums from a number of his clients. However, he failed to forward the money to an insurer or secure the insurance coverage. The suspect fled to Puerto Rico where he was arrested on a warrant issued in Queens Supreme Court. He was extradited to New York City on 7/11/06 and arraigned in Queens Criminal Court.
Arrested on 7/5/06
Charged with arson, attempted insurance fraud and attempted grand larceny
A Brooklyn man filed a claim with Allstate Insurance Company stating that his 2002 Ford Explorer burned in a fire but that he had no knowledge of the cause of the fire. However, during an investigation by the New York City Fire Marshals with the assistance of the Frauds Bureau, the suspect admitted that he had intentionally set the fire for the insurance settlement.
- ATTEMPT FAILED
Arrested on 6/29/06
Charged with insurance fraud in the 3rd degree
The defendant in this case submitted a claim to the Workers Compensation Board that he allegedly knew contained materially false information as to his employment status, in a failed attempt to collect more than $3,000 in workers compensation benefits to which he was not entitled. The Frauds Bureau conducted the investigation that led to his arrest.
Arrested on 5/5/06
Charged with mail and wire fraud
An investigation conducted jointly by the Frauds Bureau, the U.S. Postal Inspectors Office and the U.S. Attorneys Office resulted in the arrest of a man who represented himself as a licensed insurance agent/broker who owned several insurance agencies located in New York and Canada. He allegedly collected premiums for commercial policies but failed to remit the money to the insurance companies or secure the coverage. He issued bogus policies and settled claims. He was arrested in Canada and will be extradited to New York.
Arrested on 3/28/06
Charged with grand larceny and falsifying business records
This suspect, a former insurance agent, collected $10,000 in postal money orders to obtain life insurance coverage for a client. However, he failed to forward the money to the insurance company but instead put it to his personal use. The investigation that led to his arrest was conducted by the Frauds Bureau.
FRAUDULENT SURETY BOND
Arrested on 3/23/06
Charged with forgery in the 3rd degree
An investigation by the Frauds Bureau resulted in the arrest of a contractor who submitted an allegedly fraudulent Performance Bond in the amount of $1,125,000 purportedly issued by Western Surety Company. However, evidence uncovered during the investigation showed that Western Surety had never received premiums and had no knowledge of the Bond.
Arrested on 10/26/05
Charged with grand larceny and forgery
A licensed insurance agent convinced an elderly client to cancel an annuity of longstanding and open a new one so that the agent would earn the substantially higher commission attendant on new policies. The client gave oral permission for the change. The agent then forged the clients signature to the paperwork. The Frauds Bureau and the Nassau County DAs Office pooled resources in this investigation.