Arrests for May 2009
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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- THREE CLAIMS PAID
Arrested on 05/29/09
Charged with insurance fraud in the 3rd degree, forgery in the 2nd degree, offering a false instrument for filing and falsifying business records
A year-long investigation by the Frauds Bureau and Aetna Insurance Company’s SIU resulted in the arrest of an upstate clerical worker accused of filing claims for dental treatments that she never received or minor treatments for which she was not charged. The defendant filed five claims for a total of $6,806. Aetna paid out $3,559 on the first three claims before the insurer became suspicious and called on the Frauds Bureau to initiate an investigation. Evidence was subsequently found indicating that all five claims were fraudulent.
- WORKING TWO JOBS
Arrested on 05/29/09
Charged with violation of the Workers’ Compensation Law
Following an injury on the job, the defendant in this case began collecting workers’ compensation benefits. However, an investigation by the Frauds Bureau revealed that between November 12, 2008 and May 7, 2009, she was working at her husband’s craft store and was also acting as a consultant for a food products company. Moreover, in January and February 2009 she submitted Work Activity Reports to the State Insurance Fund stating that her injury left her unable to work. When faced with the evidence, the defendant admitted that she fraudulently collected $8,691 in benefits.
- DOCTOR CAUGHT
Arrested on 05/28/09
Charged with grand larceny in the 3rd degree and violation of the Workers’ Compensation Law
An investigation by the Frauds Bureau, the Workers’ Compensation Board and the Westchester County DA’s Office led to the arrest of a Yorktown Heights orthopedist for conspiring with a patient (a former correction officer) to defraud the workers’ compensation system. From 2001 to 2006, the doctor filed 55 reports stating that the patient was totally disabled, was not working and should continue receiving benefits. In exchange, the patient, who owned a general contracting and home renovation business, agreed to do renovations on the doctor’s home and office. He pleaded guilty in 2006 to grand larceny in the 2nd degree and filing a false tax return and was ordered to pay $131,853 in restitution.
- NOT ENTITLED
Arrested on 05/22/09
Charged with insurance fraud in the 3rd degree, offering a false instrument for filing in the 1st degree and violation of the Workers’ Compensation Law
Following a work-related injury, the defendant began collecting workers’ compensation benefits. An investigation by the Frauds Bureau revealed that he submitted a Work Activity Report to the State Insurance Fund stating that he was unable to work. And from 2/18/08 through 5/11/09, he fraudulently received $25,198 in benefits while he was employed.
- SURVEILLANCE SHOWS
Arrested on 05/22/09
Charged with violation of the Workers’ Compensation Law
The defendant in this case was charged with collecting workers’ compensation benefits while she was employed. Records showed that she submitted a Work Activity Report to Liberty Mutual Insurance Company stating that she was not working. However, during surveillance conducted over the 10/4/08 through 10/21/08 time period, Frauds Bureau investigators observed the defendant working. As a result of the fraud, she collected $4,867 in benefits to which she was not entitled.
- UNREPORTED PAYROLL
Arrested on 05/21/09
Charged with grand larceny in the 2nd degree, insurance fraud in the 2nd degree, falsifying business records in the 1st degree, offering a false instrument for filing in the 1st degree and violation of the Workers’ Compensation Law
A business owner and his home improvement company were audited by the State Insurance Fund on 12/17/07 where records indicated that the business had no payroll for the first quarter of 2007, and a $36,403 payroll for just one employee for the second quarter. However, an investigation by the Frauds Bureau revealed that an audit performed on another Fund policyholder showed payments to the defendant’s company of more than $500,000 for the period 2/17/06 to 2/17/07. Investigators determined that the defendant had deposited $433,653 into the account of a payroll company between 7/1/06 and 7/1/07, the period for which he was being audited. The money was allegedly used to prepare payroll for his company. The fraud amount during this period, based on the unreported payroll, was $65,166.
- PHONY CERTIFICATES
Arrested on 05/21/09
Charged with grand larceny in the 2nd degree, insurance fraud in the 2nd degree, falsifying business records in the 1st degree and offering a false instrument for filing in the 1st degree
A plumbing sub-contractor was accused of presenting fraudulent Certificates of Insurance to three contractors as proof that he had valid workers’ compensation insurance for his employees when, in fact, no such coverage was in place. The cost of the fraud to his victims was approximately $30,000. The Frauds Bureau, the State Insurance Fund and AIG Insurance Company’s SIU pooled resources in the investigation that led to the arrest.
- RESTAURANT WORKER
Arrested on 05/21/09
Charged with falsifying business records in the 1st degree and violation of the Workers’ Compensation Law
The defendant in this case began receiving workers’ compensation benefits after he sustained an injury on the job. During the benefit period, he submitted a Work Activity Report to the State Insurance Fund stating that he had not worked since his accident. However, an investigation by the Frauds Bureau uncovered evidence showing that for about six-to-eight weeks around September 2008, he collected benefits while working at a local restaurant.
- UNDERREPORTING
Arrested on 05/21/09
Charged with grand larceny in the 2nd degree, falsifying business records in the 1st degree and insurance fraud in the 2nd degree
An investigation by the Frauds Bureau led to the arrest of a Queens exterminator on charges that he defrauded the State Insurance Fund of more than $50,000 in premiums. The defendant allegedly submitted documents to the Fund in which he failed to disclose the true nature of his business and underreported the size of his payroll.
- PREMIUMS DUE
Arrested on 05/20/09
Charged with grand larceny in the 3rd degree, falsifying business records in the 1st degree and insurance fraud in the 3rd degree
The owner of an interior design business made allegedly false statements on an application for workers’ compensation and general liability insurance. An investigation by the Frauds Bureau, the State Insurance Fund and AIG Insurance Company’s SIU revealed that the defendant’s application failed to disclose that he owed $11,000 in premiums on a separate policy with the Fund.
- ENHANCED DAMAGES
Arrested on 05/20/09
Charged with grand larceny in the 3rd and 4th degrees, insurance fraud in the 3rd, 4th and 5th degrees and petit larceny
An investigation by the Frauds Bureau and the NYPD’s Auto Crime Division resulted in the arrest of the owner of a Brooklyn auto body shop. Evidence disclosed that the defendant repaired a 2008 Volvo that was insured by AIG Insurance Company and submitted a bill for parts and labor in the amount of $13,468 which the insurer paid. However, an inspection of the repaired car showed that AIG paid more than $3,000 for parts that were not installed and repair work that was not done.
- MECHANIC AT WORK
Arrested on 05/20/09
Charged with insurance fraud in the 3rd degree, grand larceny in the 3rd degree, offering a false instrument for filing in the 1st degree and violation of the Workers’ Compensation Law
An upstate auto mechanic was classified as permanently partially disabled following a work-related injury in March 1991 and began to receive workers’ compensation benefits. During the benefit period, he submitted to the State Insurance Fund several Work Activity Reports and medical examination results to support his claim of severe restrictions on his range of motion and on his performance of the activities of daily living. However, an investigation by the Frauds Bureau and the Fund’s Division of Confidential Investigations found that he was employed as a mechanic at a local auto shop where he also answered calls for roadside assistance. As a result of the fraud, he collected more than $18,000 in benefits to which he was not entitled. The defendant, accompanied by his attorney, surrendered himself to the Schuyler County Sheriff’s Office.
- JAIL DEPUTY CHARGED
Arrested on 05/20/09
Charged with insurance fraud in the 4th degree and falsifying business records in the 1st degree
As a result of a joint investigation conducted by the Frauds Bureau and the City of Rome Police Department, a Rome, NY, jail deputy was arrested on charges that he filed a fraudulent auto insurance claim with AIG Insurance Company. On October 28, 2008, the defendant was involved in an accident in which he drove his car into the rear end of the vehicle in front of him. He called 911 from the scene and reported that a two-car accident had caused front-end damage to his car. However, he subsequently filed a claim with AIG stating that a third car had been involved causing additional damage to the rear end of his car. Investigators examined photos of his car taken after the accident that made it evident that there was no rear-end damage at that time. Further investigation revealed that between the time of the accident and the submission of the claim, the rear bumper cover of the defendant’s car was in fact damaged and made part of the fraudulent claim for which AIG paid him $1,332.
- NO BENEFITS DUE
Arrested on 05/20/09
Charged with grand larceny in the 3rd degree, falsifying business records in the 1st degree, insurance fraud in the 3rd degree and offering a false instrument for filing in the 1st degree
After incurring injuries to his back and foot while working as an exterminator, this suspect began receiving workers’ compensation benefits. However, an investigation by the Frauds Bureau uncovered evidence indicating that he was employed while fraudulently collecting nearly $30,000 in benefits.
- TITLE INSURANCE FRAUD
Arrested on 05/19/09
Charged with insurance fraud and wire fraud
The operator of three title insurance agencies in New York and Suffolk Counties was charged with misappropriating millions of dollars of escrow and other client funds and embezzling a part of those funds for his personal use. An investigation by the Frauds Bureau, the FBI and the Office of the U.S. Attorney for the Southern District found evidence that between January 2008 and April 2009, the defendant allegedly withdrew about $2.2 million in cash from one of the companies, which at times totaled $300,000 or more in a single month. To sustain the company’s operations, the defendant essentially used new funds from clients to pay off the debts to older clients. In addition, the defendant failed to record dozens of real estate transactions in a timely fashion in spite of the fact that he had already been paid to record the transactions.
- UNDERCOVER OPERATION
Arrested on 05/19/09
Charged with insurance fraud in the 4th degree, grand larceny and falsifying business records
An undercover operation conducted by the Frauds Bureau and the NYPD led to the arrest of the owner of a Staten Island auto body shop and three of his employees, two of whom were family members, charged with enhancing the damages on two vehicles. However, the vehicles, supplied by GEICO Insurance Company, had “controlled damage” that was photographed and documented before the vehicles were put in the shop by undercover investigators. GEICO was billed for excessive damages in the thousands of dollars.
- WRONG DATE
Arrested on 05/19/09
Charged with grand larceny in the 3rd degree and insurance fraud in the 3rd degree
The defendant in this case was involved in an auto accident on 8/27/07 and submitted an $8,640 claim to Farm Family Casualty for the damages. In support of his claim, he submitted photos of the car purported to have been taken following the 8/27 accident. However, an investigation by the Frauds Bureau and the NYPD revealed that the photos were from an accident he had been involved in on 4/12/07 and for which he was paid $7,000 by Republic Western Insurance Company. Moreover, investigators learned that both parties to the 8/27 accident agreed at the time that minimum damage had been done.
- PREMIUM FRAUD
Arrested on 05/13/09
Charged with violation of the Workers’ Compensation Law
An investigation by the Frauds Bureau resulted in the arrest of the president of a roofing company who was charged with defrauding the State Insurance Fund. The defendant allegedly underreported his payroll and gross sales in order to reduce the amount of premiums he should have paid for workers’ compensation and general liability insurance coverage. Based on his underreporting, the State Insurance Fund lost $89,287 in premiums for the two-year period from 1/1/07 to 1/1/09.
- FALSE REPORT
Arrested on 05/07/09
Charged with insurance fraud in the 3rd degree and false written statement
As a result of a sting operation conducted by the Frauds Bureau and the NYPD’s Auto Crime Division, a Nassau County man was arrested for attempting to fraudulently collect an insurance payment. On 1/22/09, he reported to the Nassau County Police Department that his 2006 Ford Fusion had been stolen. However, the NYPD had recovered the car prior to the theft report. The NYPD subsequently discovered that they did not have venue to prosecute and the case was given to the Nassau County Police Department who made the arrest.
- OWNER GIVE-UP
Arrested on 05/07/09
Charged with arson in the 3rd degree, grand larceny in the 3rd degree, criminal possession of stolen property in the 3rd degree, insurance fraud in the 3rd degree, falsifying business records in the 1st degree and offering a false instrument for filing in the 1st degree
In July of 2004, this suspect reported to the Town of Woodbury Police Department that his 2002 Acura Integra was stolen. He submitted a claim to Progressive Insurance Company and was paid $19,000 for the loss. However, an investigation by the Frauds Bureau revealed that the suspect had rented a storage facility where he kept the vehicle from July 2004 until investigators uncovered it. Investigators also found evidence that he had tried to destroy the vehicle by fire.
- REMARRIED
Arrested on 05/05/09
Charged with insurance fraud in the 3rd degree, offering a false instrument for filing and violation of the Workers’ Compensation Law
An investigation by the Frauds Bureau, the Office of the Workers’ Compensation Fraud Inspector General and the State Insurance Fund’s Division of Confidential Investigations led to the arrest of an upstate woman accused of defrauding the workers’ compensation system. When her husband died in 1978, she began receiving survivor’s death benefits that would continue unless she remarried. However, investigators discovered that on 5/15/06 and again on 5/12/08, she submitted documents to the Fund stating the she had not remarried when in fact she had. During the investigation period from 5/06 through 12/08, she collected $44,110 to which she was not entitled.
