Arrests for June 2008
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
- PLEA AGREEMENT
A joint investigation by the Frauds Bureau Workers' Compensation Fraud Inspector General's Office, the New York State Department of Environmental Conservation Police and the U.S. Environmental Protection Agency resulted in the arrest on 6/4/08 of a contractor who misinformed his insurer about the nature of his company's business. Investigators found that the company was involved in asbestos removal. As a result, for 12 years he paid lower premium rates than was warranted by the risk involved. In addition, he paid off a monitoring company to provided false laboratory analysis in order to mislead clients and regulators. He pleaded guilty to conspiracy to commit mail fraud and conspiracy to violate the Clean Water/Clean Air Acts. As a provision of his plea agreement, he must pay a $166,700 fine, part of which will go to reimburse his insurer. He faces up to five years in prison and an additional $250,000 fine.
- OH, WAITRESS
Arrested on 6/26/08
Charged with offering a false instrument for filing and committing a fraudulent practice under Section 114 of the Workers' Compensation Law
While collecting workers' compensation benefits for an injury sustained on the job, this defendant submitted four Work Activity Reports to the State Insurance Fund stating that she was not working in any capacity. However, an investigation conducted by the Frauds Bureau and the State Police revealed that she was employed as a waitress in a local diner, thereby collecting benefits to which she was not entitled.
- RENTAL, NOT RESIDENCE
Arrested on 6/25/08
Charged with falsifying business records in the 1st degree
This suspect applied for mortgage insurance on a home he purportedly was going to purchase. In the application, he stated that the home would be his primary residence. When the Frauds Bureau received a report of suspected fraud from Genworth Mortgage Insurance Company, they initiated an investigation and found that the suspect was actually purchasing the house for his nephew who was going to use it entirely as a rental property.
- HIGH LIVING
Arrested on 6/24/08
Charged with insurance fraud in the 4th degree and falsifying business records in the 1st degree
An investigation by the Frauds Bureau led to the arrest of an Oneonta couple charged with filing a fraudulent claim for living expenses following a fire that destroyed their home. In support of the claim, they submitted a copy of a rental agreement which stated that they were paying $1,700 a month for rent. However, evidence uncovered during the investigation indicated that they had altered the agreement to inflate the actual rental amount.
Arrested on 6/20/08
Charged with insurance fraud in the 3rd degree, offering a false instrument for filing in the 1st degree and violation of Section 114-1 of the Workers' Compensation Law
On 12/12/07, this suspect slipped and fell in the parking lot of a restaurant at which she was employed, causing a broken wrist. She began collecting workers' compensation benefits, during which time she submitted several Work Activity Reports to the State Insurance Fund stating that she had not worked since her accident. The Frauds Bureau, the State Fund and the Workers' Compensation Fraud Inspector General's Office conducted a joint investigation and found that the suspect had returned to work in a liquor store which she owned. She collected $4,295 during the benefit period to which she was not entitled.
- WORKERS' COMP FRAUD
Arrested on 6/19/08
Charged with grand larceny in the 3rd degree
A Lawrenceville, PA, woman was arrested and charged with collecting $10,700 in workers' compensation benefits while she was employed at a Corning, NY, hotel. She accepted the benefits between March 2007 and April 2008 for a 2001 injury that she claimed left her unable to work. If convicted, she faces up to seven years in prison. The Frauds Bureau and the State Police pooled resources in the investigation that led to her arrest.
- A COUPLE OF FRAUDSTERS
Arrested on 6/18 and 6/25/08
Charged with insurance fraud in the 3rd degree and falsifying business records in the 1st degree
An upstate nurse reported her 2005 Chevy Trail Blazer stolen from the parking lot of a local shopping mall. However, an investigation by the Frauds Bureau and the Town of Ulster Police Department turned up evidence that she paid her co-defendant in this case $500 to retrieve the car from the parking lot where she had left it with the keys inside. The co-defendant allegedly drove the car to an apple orchard and set it on fire while she went to Atlantic City overnight to establish an alibi. She was arrested on 6/18; her co-defendant was charged on 6/25 in Ulster County Jail where he is incarcerated on unrelated charges. The Town of Plattekill Police Department and the New Jersey State Police Casino Detail provided assistance in this ongoing investigation.
- LEAKY PIPES
Arrested on 6/18/08
Charged with insurance fraud in the 3rd degree and falsifying business records in the 1st degree
A contractor from Cooperstown, NY, sustained water damage to his home when the pipes leaked. He had contractors assess the damage and provide estimates for repair. He filed a claim with New York Central Mutual Fire Insurance Company for the loss, together with the two repair estimates totaling $6,670. When Frauds Bureau investigators, assisted by the Otsego County Sheriff's Department, looked into the matter, they discovered that the suspect had stamped the estimates "Paid" in an attempt to fraudulently collect an insurance payout.
- NO COVERAGE
Arrested on 6/17/08
Charged with grand larceny in the 4th degree and scheme to defraud in the 1st degree
An investigation by the Frauds Bureau, the Cobleskill Police Department and the Schoharie County DA's Office led to the arrest of a hardware store owner amid allegations that from November 2007 to April 2008, he took payments from an employee that was supposed to pay for health insurance coverage for a member of the employee's family. However, investigators discovered that the business owner did not secure coverage for the family member. That person, who was unaware that he had no health insurance, incurred $11,000 in medical bills. The Frauds Bureau became aware of the alleged fraud through a consumer complaint.
- FRAUDULENT CERTIFICATE
Arrested on 6/13/08
Charged with forgery in the 2nd degree
On 4/12/08, this suspect submitted a Certificate of Insurance to the State Insurance Fund as evidence that he had workers' compensation insurance coverage as required by New York State Law. However, evidence found during an investigation by the Frauds Bureau indicated that he had altered the Certificate and no such coverage was in place.
- TEACHER CAUGHT
Arrested on 6/12/08
Charged with insurance fraud and offering a false instrument for filing
A Utica woman was arraigned on June 25 on charges that she fraudulently collected $52,983 in workers' compensation benefits while employed as an elementary school reading teacher for the Utica City School District. An investigation by the Frauds Bureau and the State Insurance Fund found that she claimed she was unable to work because of an allergic reaction she suffered while employed as a teacher at an upstate correctional facility in 1997. From October 2004 to December 2007, she accepted benefits to which she was not entitled.
- UNDER-REPORTED PAYROLL
Arraigned on 6/12/08
Charged with falsifying business records and committing a fraudulent practice under the Workers' Compensation Law
A Colonie-based trucking company was charged with under-reporting its payroll by $2.2 million from November 2003 to November 2006. Under-reporting wages is one of the factors used in determining workers' compensation premiums. The fraud cost the State Insurance Fund $300,981 in lost premiums. Investigators said that the under-reporting was discovered in an audit of the company's payroll conducted as part of a joint investigation by the Frauds Bureau and the State Fund.
- TREATMENTS NOT COVERED
Arrested on 6/8/08
Charged with insurance fraud in the 4th degree, falsifying business records in the 1st degree, and forgery in the 3rd degree
The defendant in this case submitted claims to MVP Health Plan for office visits and laboratory tests that she stated had occurred after September 2007 when her health insurance coverage became effective. However, an investigation by the Frauds Bureau uncovered evidence that the defendant had altered the billing dates for the tests and visits which had actually taken place in July and August 2007, a time period that predated her coverage. In addition, she inflated the billings by $120, claiming a total of $1,391 in medical expenses.
- NO BURGLARY
Arrested on 6/4/08
Charged with insurance fraud in the 3rd degree and offering a false instrument for filing
On 3/19/08, the suspect in this case reported to the Niagara Falls Police Department that his home was broken into and $10,000 in cash and $3,920 in personal property were stolen. He also filed a claim with State Farm Insurance Company for the loss. However, after investigators from the Frauds Bureau, the Niagara Fall PD and State Farm's SIU conducted an investigation of the purported crime scene and interviewed witnesses, they determined that the burglary had never taken place.
- FRAUDULENT DOCUMENTS
Arrested on 6/3/08
Charged with insurance fraud in the 3rd degree and falsifying business records
The defendant in this case filed a claim with Harleysville Insurance Company for water damage to his business, a funeral home. He also submitted documentation for loss-of-business expenses. Based on a report of suspected fraud from the insurer, the Frauds Bureau initiated an investigation that revealed that the documents for loss-of-business expenses were fraudulent. He was charged with insurance fraud and falsifying business records in connection with his unsuccessful attempt to collect a $6,000 insurance payment.
- NO HELP
Arrested on 5/14/08
Chargedwith grand larceny in the 4th degree and insurance fraud in the 4th degree
A pedestrian who stated that she was hit by a car filed a claim with Nationwide Insurance Company, the driver's insurer. She sought coverage under no-fault benefits for household help she said was necessary because of the injuries she incurred in the accident. With the claim, she submitted receipts for two postal money orders for $1,100 which she said was used to pay the worker. However, during an investigation by the Frauds Bureau and the NYPD's Fraudulent Accident Investigation Squad, the worker denied that he had worked for this defendant during the time she said he had. In fact, the defendant allegedly forged the worker's signature on the work form. The money orders were deposited into her personal bank account.