Arrests for October 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
CAUGHT!
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- SENTENCED
William Hrazanek, an Ulster County junkyard dealer, pleaded guilty on 10/6/08 to reduced charges of insurance fraud in the 5th degree and offering a false instrument for filing in the 2nd degree. As part of his plea arrangement he was given a one-year conditional discharge on each count and was ordered to pay $2,175 in fines and court fees. He was accused of making use of used cars with high mileage that he fraudulently insured, registered and then sold to unlicensed drivers who were also undocumented immigrants. The scam earned him thousands of dollars a year over a four-year period. The judge noted that Hrazanek had no criminal record and may still face civil actions. An investigation by the Frauds Bureau and the Ulster County Sheriff’s Department led to his arrest on 2/12/08.
Thaddeus J. Okoniewski, a former insurance broker who continued to sell insurance after his license was revoked in 2002, was sentenced on 10/14/08 to five years’ probation for pocketing $90,000 premiums from businesses located across New York State. The revocation of his license occurred after he confessed to selling bogus workers’ compensation and general liability insurance. He was arrested in September 2006 following an investigation by the Frauds Bureau and the Broome County DA’s Office, and pleaded guilty to grand larceny more than a year before his sentencing. The investigation began when a New York City apartment owner complained to the Frauds Bureau that an insurance claim was never paid despite repeated inquiries to Okoniewski. Investigators found that he had given the apartment owner a forged Certificate of Insurance and kept $31,000 in premiums. Other businesses that were victimized in a similar way included a Tioga County nursing home, a self-employed painter, a Watertown area motorcycle dealership, and a Westchester County country club, which lost $50,000 in premiums.
Robert Rich of upstate New York was sentenced on 10/17/08 to six months in jail and five years’ probation and must pay $60,000 in restitution to the State Insurance Fund, after pleading guilty a month earlier to grand larceny and violation of Section 114.1 of the Workers’ Compensation Law . He began collecting workers’ compensation benefits following a back injury on the job in March 2001. However, an investigation by the Frauds Bureau, the State Fund and the State Police uncovered evidence that he returned to work operating a snow plowing business during the winter months from 12/31/01 until 6/18/07 while still collecting benefits. During that time, he submitted 19 Work Activity Reports to the Fund stating that he was unable to work.
On 10/9/08, Nicholas M. Dellaratta of Staten Island, NY, pleaded to disorderly conduct and was sentenced to a one-year conditional discharge and ordered to pay a $250 fine. He had reported his 2003 Workhorse van stolen in January 2008. The NYPD was subsequently informed that the car was parked at a lot in Brooklyn and that the owner may have given it up for the insurance settlement. The NYPD drove to the Brooklyn location and observed Dellaratta moving the van from that location to another. He was arrested for possession of stolen property and in court, he pleaded guilty to a reduced sentence.
- GUILTY PLEA
James R. Warmuz pleaded guilty on 10/15/08 to a charge of fleeing an officer. The charges were the result of an insurance claim he filed following an 8/5/08 incident in which his car was damaged while he was being pursued by West Seneca police. Police had followed Warmuz after observing him driving his 2003 Chevrolet Corvette at a high rate of speed. He turned onto a dead-end street in East Buffalo as he attempted to evade two West Seneca police cars. He refused officers’ orders to get out of the car, backed out around the stopped police cars and fled the scene. His car was damaged in the process. Warmuz went to a West Seneca police station several hours later, and for reasons that are unclear, reported his car stolen. He was arrested when officers recognized him as the suspect who had earlier evaded them. He was charged with falsely claiming the damages occurred as a result of vandalism when the car was parked in front of his house.
- WORKERS WERE ON THE JOB
Arrested on 10/31/08
Charged with violation of Section 114.1 of the Workers’ Compensation Law
The defendant in this case reported to the State Insurance Fund that he had no employees on his payroll. However, a review of Fund records indicated that he was a sub-contractor and his construction company had a number of workers on the payroll. The Frauds Bureau and the Fund combined efforts in the investigation that led to his arrest.
- MEDICAL MILL TAKEDOWN
Arrested on 10/29/08
Charged with enterprise corruption and insurance fraud
A 19-month investigation led to the indictment of 61 individuals and two businesses, accused of staging more than 40 auto accidents over a three-year period. The ring targeted unsuspecting Asian drivers who, while backing out of a driveway or a parking lot, would be deliberately hit by a car full of passengers all of whom were participants in the fraud. Occupants of the cars involved were then sent to the same Upper Manhattan medical clinic whose operators were knowing participants in the scheme. In fact, these operators allegedly paid “runners” up to $2,500 for each person referred to the clinic. The “patients” were also paid. The scheme defrauded insurers of $1.6 million. The investigation was conducted jointly by the Frauds Bureau, the Queens DA’s Office, the FBI, the NYPD’s organized crime division and a number of victimized insurance companies.
- MORTGAGE WOES
Arrested on 10/28/08
Charged with insurance fraud in the 2nd degree and arson in the 3rd degree
An upstate man was arrested in connection with a 6/7/08 fire at a four-unit apartment building that he owned. He filed a $50,000 claim with State Farm Insurance Company for the loss. However, the Albany City Fire and Police Departments conducted an origin and cause investigation and determined that the fire was intentionally set. An investigation by the Frauds Bureau and the Albany County DA’s Office revealed that the defendant was behind on his mortgage payments and had to make significant repairs before he could rent the units. In addition, investigators uncovered security camera footage from an adjacent building, showing that the defendant was the last one inside the building before the fire was set. After his arraignment, he was returned to Saratoga County Jail where he is incarcerated on a charge of grand larceny in an unrelated case.
- FRAUDULENT CERTIFICATE
Arrested on 10/27/08
Charged with criminal possession of a forged instrument and insurance fraud in the 5th degree
This suspect was hired as a sub-contractor for a construction company and submitted a Certificate of Insurance as proof that he had the workers’ compensation coverage required by New York State Law. However, an investigation by the Frauds Bureau uncovered evidence that he had altered the expiration date on the Certificate and no coverage was currently in place. As a result of the fraud, he avoided paying $4,000 in workers’ compensation premiums.
- TRUMPED UP
Arrested on 10/27/08
Charged with violation of Section 114 of the Workers’ Compensation Law
Following a job-related injury, an upstate truck driver was determined by the State Insurance Fund to be temporarily totally disabled. During the disability period, he submitted three Claimant Record of Medical and Travel Expense Forms to the Fund, listing his home address as Montrose, PA, a location that would have entitled him to significantly higher expense payments. However, an investigation by the Frauds Bureau with the assistance of the City of Binghamton Police Department revealed that he was actually residing in Binghamton. As a result, he collected $3,039 in expenses to which he was not entitled.
- KEEP THE DATES STRAIGHT
Arrested on 10/25/08
Charged with criminal possession of a forged instrument in the 2nd degree, grand larceny in the 3rd degree, insurance fraud in the 3rd degree and falsifying business records in the 1st degree
An investigation by the Frauds Bureau and the NYPD’s Auto Larceny Unit led to the arrest of a Bronx woman accused of defrauding GEICO Insurance Company of $7,874. She reported to the NYPD and to the insurer that her car had been involved in an accident on 11/28/05. She subsequently filed a claim and was reimbursed for the cost of repair. However, investigators learned that the accident actually occurred on 11/23/05 but her insurance policy had been cancelled on 11/17/05. She renewed the coverage on 11/26/05 and submitted a receipt for towing on which she had altered the date. Further investigation found that her car had been towed on 11/23, not 11/28 as indicated on the forged receipt.
- DRIVING THE BUS
Arrested on 10/23/08
Charged with violation of Section 114.1 of the Workers’ Compensation Law
The suspect is this case claimed he was unable to work as a result of a work-related illness he contracted in 1989 while employed as a New York Daily News truck driver. He allegedly reported to Travelers Insurance Company on five separate occasions that he was unable to work because of his disability. However, an investigation by the Frauds Bureau uncovered evidence that he had returned to work as a school bus driver, a fact that he neglected to report to his insurer. As a result, he collected $46,800 in benefits to which he was not entitled.
- RESTAURANT OWNER CHEATS
Arrested on 10/22/08
Charged with violation of Section 114.1 of the Workers’ Compensation Law
After sustaining an injury related to her job as a hotel attendant, a Long Island woman was found to be working at a restaurant she owned while illegally collecting more than $20,000 in workers’ compensation benefits. The Frauds Bureau conducted the investigation that led to her arrest.
- NOT DISABLED
Arrested on 10/22/08
Charged with insurance fraud, grand larceny and falsifying business records
An investigation by the Frauds Bureau resulted in the arrest of an upstate man who was accused of fraudulently collecting more than $100,000 in disability benefits. The suspect claimed he was unable to work after a slip-and-fall accident at his workplace in 2003. However, investigators discovered that he later took a job with a construction company while collecting the benefits. In addition, he had advised his insurer on several occasions that he was not working.
- FAMILY CONSPIRACY
Arrested on 10/16/08
Charged with conspiracy to defraud the United States, violate the Clean Air Act, violate the Superfund Act and commit mail fraud
One defendant in this family-run conspiracy was convicted in 2003 of violations of the Clean Air Act related to his illegal asbestos removal and disposal business. In 2004, he was convicted of insurance fraud related to the activities of that business. As a result, he was prohibited from engaging in any asbestos abatement activities or associating with anyone so engaged. The present indictment alleged that this defendant and his father, also indicted, set up companies in the names of relatives and associates to hide his continued involvement with asbestos removal. The defendant’s brother, an attorney and also a co-defendant in this case, was charged in the conspiracy count with aiding his family in its illegal asbestos activities. Another brother pleaded guilty on 10/2/08 to a conspiracy to violate the Superfund Act. The investigation was conducted by the U.S. Environmental Protection Agency and the New York State Department of Environmental Conservation, with assistance from the New York State Department of Labor, the New York State Workers’ Compensation Board Fraud Inspector General’s Office, the State Insurance Fund and the Frauds Bureau.
- FORGED CHECKS
Arrested on 10/16/08
Charged with grand larceny, falsifying business records and insurance fraud
The defendant in this case allegedly forged and cashed disability benefits checks issued to her husband for more than five years after his death. An investigation by the Frauds Bureau revealed that from March 2002 through December 2007, she forged her husband’s signature to a total of $75,900 in benefit checks from Northwestern Mutual Life Insurance Company, while filing reports with the insurer intended to mislead them into thinking her husband was still alive.
- BACK AT WORK
Arrested on 10/16/08
Charged with grand larceny, insurance fraud, falsifying business records, offering a false instrument for filing and violation of Section 114 of the Workers’ Compensation Law
This suspect was injured in 1992 while working as a home health aide and began collecting workers’ compensation benefits. However, an investigation by the Frauds Bureau turned up evidence that she had returned to work in 2003 and from that time until her arrest, she filed six reports with the State Insurance Fund stating that she had not worked since her accident. As a result, she fraudulently collected $19,360 in benefits.
- PREMIUMS DUE
Arrested on 10/15/08
Charged with grand larceny, insurance fraud, falsifying business records and violation of Section 114.1 of the Workers’ Compensation Law
An investigation by the Frauds Bureau resulted in the arrest of a Queens man who submitted an allegedly fraudulent application to the State Insurance Fund for workers’ compensation insurance for his company. However, when asked on the application if he had previously been insured by the Fund, he denied it, when in fact he had been insured under a different company name and owed more the Fund than $28,185 in past due premiums.
- NO COVERAGE
Arrested on 10/15/08
Charged with insurance fraud, falsifying business records and violation of Section 114 of the Workers’ Compensation Law
On 6/3/08, 3/24/07 and 4/14/06, a sub-contractor, who was the proprietor of two construction companies, presented to his employer Certificates of Insurance indicating that his companies had the required workers’ compensation and employer’s liability insurance coverage. However, an investigation by the Frauds Bureau revealed that no such coverage existed. In fact, the suspect altered the Certificates, defrauding his insurer, Erie Insurance Company, of almost $9,600 in unpaid premiums.
- NO COVERAGE AGAIN
Arrested on 10/14/08
Charged with criminal possession of a forged instrument, insurance fraud, grand larceny, falsifying business records and violation of Section 114.1 of the Workers’ Compensation Law
When he was hired as a sub-contractor, the defendant in this case presented his employer with a Certificate of Insurance as proof that he had the required workers’ compensation insurance. However, an investigation by the Frauds Bureau revealed that the Certificate was fraudulent and no such coverage existed. His corporation was also charged in this case.
- NICE TRY
Arrested on 10/14/08
Charged with insurance fraud and grand larceny
On 4/7/08, this suspect reported to GEICO Insurance Company that on or about 4/5/08, her 2000 GMC Jimmy was stolen from a local street where she had left it parked. Evidence revealed that on 4/6/08, the suspect’s car had been stopped by the Rochester Police and a lone male driver was arrested for aggravated unlicensed operation. The vehicle was impounded. The suspect stated that she did not know the driver. A property damage appraiser from GEICO inspected the car and observed moderate damage which the suspect claimed must have occurred during the theft. However, a review of the suspect’s past claim history conducted during an investigation by the Frauds Bureau, the Rochester Police Department and GEICO’s Special Investigations Unit, showed that on 2/7/08, the suspect filed a claim for damage to the same car for which GEICO paid her $2,887 for the cost of repairs. A comparison of the estimates and photos from the 2/7/08 and 4/7/08 claims made it evident that the damage was the same and had never been repaired. When confronted with the evidence, the suspect admitted that she was attempting to collect a second settlement for the same damage.
- WE CONFESS
Arrested on 10/10/08
Charged with insurance fraud, grand larceny and auto stripping
On 3/30/06, defendant #1 in this case reported to the Lancaster Police Department that his 2004 Pontiac Vibe had been stolen from the parking lot at his workplace. He subsequently filed a claim with Allstate Insurance Company and was paid $14,357 for the loss. However, on 8/22/08, the Frauds Bureau was contacted by the Niagara Falls Police Department stating that the vehicle reported stolen by the defendant five months earlier had been recovered, with a number of parts missing, inside the collision shop of defendant #2. During an ensuing investigation, the defendants were interviewed and both admitted that defendant #1 had arranged for defendant #2 to dispose of the car in an effort to collect an insurance payout.
- BIG TIME DEBT
Arrested on 10/10/08
Charged with violation of Section 114 of the Workers’ Compensation Law
An investigation by the Frauds Bureau resulted in the arrest of a Long Island man who submitted an allegedly fraudulent application to the State Insurance Fund for workers’ compensation insurance for his parking lot maintenance company. However, he failed to reveal that he was listed as an officer of a second company, owned by his mother, which owed the Fund $229,895 in overdue premiums. His mother was arrested on 9/16/08 in connection with this case. She was charged with submitting an application for workers’ compensation insurance with the State Insurance Fund listing her son as an officer of the company she owned, knowing that he owed the Fund past due premiums.
- SAME DAY RECOVERY
Arrested on 10/8/08
Charged with attempted grand larceny and falsely reporting an incident
A joint investigation by the Frauds Bureau and the Buffalo Police Department led to the arrest of an upstate salesman accused of attempting to defraud GMAC Insurance Company. On 7/1/08, the suspect reported to the Buffalo Police and to GMAC that his 2007 Nissan was stolen. His policy with GMAC had an inception date of 6/27/08. Later on the day of 7/01, he reported that he had recovered the car in a damaged condition. The theft and purported damage occurred prior to his obtaining a photo inspection by GMAC. Damage was estimated at $3,941 with a $500 deductible. A claim search was conducted and showed that on 6/9/08 the suspect filed a claim for identical damage with AIG Insurance Company, his prior insurer, which paid him $3,914 less a $1,000 deductible.
- NOT ONE BUT TWO COMPANIES
Arrested on 10/8/08
Charged with insurance fraud and two counts of offering a false instrument for filing
This suspect submitted an application to the State Insurance Fund for workers’ compensation insurance for his iron works company, where he was listed as the sole owner. However, he was also listed as president of a second company which owed the Fund almost $10,000 in overdue premiums. He submitted a notarized affidavit stating that he had no affiliation with the second company. The Frauds Bureau conducted the investigation that led to his arrest.
- HERE COMES THE JUDGE
Arrested on 10/7/08
Charged with insurance fraud and two counts of falsifying business records
A Staten Island woman reported that her 2006 Nissan Altima was stolen from a location near her home. She stated that she had last seen the car at about 7:00 p.m. on 6/11/08. However, the car had been recovered by the East Greenwich, Rhode Island, Police Department prior to the suspect’s theft report. The vehicle was found parked in the vicinity of a judge’s home where its out-of-state license plates drew suspicion. The Frauds Bureau worked with the East Greenwich Police Department on the investigation that led to her arrest.
- BAD TIMING
Arrested on 10/7/08
Charged with insurance fraud, grand larceny and falsifying business records
On 3/30/08, the defendant in this case reported to the NYPD that her 2004 Honda Accord had been stolen, stating that he had last seen the car at 3:30 p.m. on that day. However, an investigation by the Frauds Bureau and the NYPD’s Auto Crime Division uncovered evidence that the car had been recovered on 3/18/08, nearly two weeks before the suspect reported it stolen.
- NOT A MESSENGER SERVICE
Arrested on 0/6/08
Charged with mail fraud under Title 18 of the U.S. Code
An investigation by the Frauds Bureau resulted in the arrest of a Korean immigrant for allegedly attempting to defraud the State Insurance Fund by hiding the true nature of his business. The suspect reported to the Fund that he operated a messenger service. However, the investigation revealed that he was in the business of asbestos removal, a high-risk business that would have required him to pay far greater premiums. Investigators learned that the suspect is an illegal alien and he was detained on an immigration and Customs Enforcement warrant. He is currently in jail in Jamesville, NY, awaiting disposition of this case and deportation from the United States.
- AUTO FRAUD
Arrested on 10/6/08
Charged with insurance fraud and grand larceny
The defendant in this case was arrested on charges that on six occasions during 2007, he filed fraudulent claims with several insurers in connection with his auto insurance policy. As a result, during that period he fraudulently collected $20,158 from MetLife Insurance Company and $15,206 from Grange Insurance Company. The Frauds Bureau, the Westchester County DA’s Office and the NYPD’s Auto Crime Division combined efforts in this investigation.
- AIDING OTHERS
Arrested on 10/3/08
Charged with criminal facilitation in the 4th degree
An investigation by the Frauds Bureau and the Westchester County DA’s Office led to the arrest of a Bronx man who was charged with aiding others who allegedly committed insurance fraud and grand larceny. On 9/27/07, this defendant permitted a Grange Insurance Company adjuster to examine a 2002 BMW in connection with an insurance claim. However, as the investigation indicated, the defendant was aware that this car had been inspected by a Metropolitan Insurance Company adjuster in connection with a separate insurance claim. The car had never been repaired.
- MISREPRESENTED
Arrested on 10/2/08
Charged with insurance fraud
A joint investigation by the Frauds Bureau and the State Police revealed that this suspect submitted a Vehicle Theft Questionnaire to GEICO Insurance Company on 3/27/08 in support of a stolen vehicle claim. However, the Questionnaire contained material misrepresentations as to the facts of the incident.
PRIOR SUPPLEMENT
September 2008
- FULL-TIME JOB
Arrested on 9/24/08
Charged with grand larceny and two counts of insurance fraud
An upstate nurse/care giver incurred a back injury while on the job on 10/28/01. She was granted permanent partial disability status and began to collect workers’ compensation benefits. At a later date, the suspect informed Utica Mutual Insurance Company that she had returned to work 4-to-6 hours a week, which entitled her to continue to receive benefits. However, a joint investigation conducted by the Frauds Bureau and the New York State Workers’ Compensation Fraud Inspector General’s Office found that the suspect was working full time as a nurse/care giver, thereby collecting nearly $8,000 in benefits to which she was not entitled.
- BACK IN BUSINESS
Arrested on 9/12/08
Charged with violation of Section 114 of the Workers’ Compensation Law
A former New York State employee reported an on-the-job back injury on 8/7/88 and began to collect workers’ compensation benefits. As recently as 7/15/08, she reported to the State Insurance Fund that she had not worked since the date of her injury. However, an investigation by the Frauds Bureau and the Fund produced surveillance evidence that she was working as a food server at a deli in Tamaqua, PA. As a result, she illegally collected $5,600 in benefits.
