Arrests for October 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
- NO DAMAGE
Arrested on 10/29/09
Charged with insurance fraud in the 4th degree and falsifying business records in the 1st degree
A Tioga County man was arrested on charges that he filed a fraudulent $5,300 claim with Allstate Insurance Company after a washing machine hose broke and flooded his basement. However, an investigation by the Frauds Bureau, the State Police and Allstate’s SIU revealed that three of the four items listed on the claim – a television stand and parts of a sound system – were actually owned by another person and were not damaged by water. The fourth item, a couch, was not in the basement at the time of the flood. Yet the defendant claimed damage to the couch and inflated its value.
Arrested on 10/28/09
Charged with health care fraud and mail fraud
In a case investigated by the Rochester Health Care Fraud Working Group (of which the Frauds Bureau is a member), a Monroe County podiatrist was charged with billing Medicare for services he did not provide. He allegedly billed for at-home procedures when in fact the procedures consisted of cutting the patients’ toe nails. This is not a payable service unless the patient has a specific diagnosis. The investigation found many discrepancies in the doctor’s billing and medical charts that indicated a pattern of fraudulent billing. The amount of the fraud is estimated to be $600,000.
- NOT ELIGIBLE
Arrested on 10/24/09
Charged with insurance fraud in the 3rd degree and offering a false instrument for filing in the 1st degree
A teacher in the Rensselaer City School District filed a health insurance claim for medical treatment received by her son, who she reported was a full-time college student. From 1/1/08 to 5/3/09, Blue Shield paid out $3,872 in benefits for her son. He was actually a part-time student and therefore not eligible for benefits under his mother’s health insurance coverage. An investigation by the State Police with the assistance of the Frauds Bureau led to her arrest.
- TWO MORE DAYS
Arrested on 10/22/09
Charged with insurance fraud and violation of the Workers' Compensation Law
Following an injury on the job on 3/24/07, a nurse employed by the New York State Department of Correctional Services began collecting workers’ compensation benefits. However, investigators from the Frauds Bureau found evidence that she submitted a doctor’s note in which she changed the return-to-work date in order to collect benefits for an additional two days. Her doctor confirmed that the note was altered.
- SWEPT UP
Arrested in October 2009
Charged with insurance fraud, grand larceny, perjury, offering a false instrument for filing criminal possession of a forged instrument, falsifying business records, violation of the Workers’ Compensation Law
An arrest sweep in Nassau County netted seven county residents accused of fraudulently collecting a total of $50,000 in workers’ compensation and insurance benefits. Four defendants were charged with insurance fraud, grand larceny, perjury, offering a false instrument for filing and violation of the Workers’ Compensation Law. Each of them certified that they were not working when in fact they were gainfully employed. One of these defendants pleaded guilty on 10/7/09 and was sentenced to pay full restitution of $7,525 in benefits he fraudulently collected. Two other defendants were accused of submitting fraudulent Certificates of Insurance to contractors as evidence that they had the required workers’ compensation insurance. However, an investigation uncovered evidence that the Certificates were not legitimate. They were charged with criminal possession of a forged instrument and falsifying business records. A final defendant in the sweep was charged with insurance fraud, falsifying business records and criminal possession of a forged instrument. He allegedly submitted altered receipts to State Farm Insurance Company for home repairs made necessary by wind damage. He also submitted $3,550 in bills that were marked “Paid,” when in fact they were only estimates of the repair costs. A joint investigation by the Frauds Bureau, the Nassau County DA’s Office, the Office of the Nassau County Commissioner of Investigations, the State Insurance Fund and the Workers’ Compensation Board’s Office of the Fraud Inspector General led to the arrests.
Arrested on 10/21/09
Charged with offering a false instrument for filing in the 1st degree
A Correction Officer from Beacon, NY, began collecting disability benefits in 1991. As recently as March 2009, he submitted a Work Activity Report stating that he was not employed. However, during an investigation by the Frauds Bureau, and the Department of Correctional Services, the State Insurance Fund, the State Police and the Workers’ Compensation Board’s Office of the Fraud Inspector General, he was observed working as a security guard/bouncer at a local night club, a fact that his employer confirmed in a written statement. As a result of the fraud, he collected $5,684 to which he was not entitled.
- EMPTY TANK
Arrested on 10/15/09
Charged with criminal possession of a forged instrument in the 2nd degree and falsifying business records in the 1st degree
On 2/3/09, the defendant in this case reported to New York Central Mutual Fire Insurance Company that a broken pipe in his home caused $20,000 in water damage. The insurer subsequently determined that there was no oil in the heating unit which caused the heat to shut off and requested the defendant to submit proof of a recent oil delivery. An investigation by the Frauds Bureau uncovered evidence that indicated the defendant changed the address on a receipt for oil that had been delivered to another home he owned. Investigators for the insurer found that the oil tank was empty in the home that was damaged. This contradicted the defendant’s claim that the home was heated and that the damage resulted because the furnace malfunctioned.
- DATE TELLS ALL
Arrested on 10/14/09
Charged with insurance fraud in the 3rd degree
On 4/1/09, the suspect reported to the Mount Vernon Police Department that he had left his 1968 Oldsmobile at a parking lot and when he returned, the car was gone. However, an investigation by the Frauds Bureau, the NYPD’s Auto Crime Division and the Mount Vernon PD revealed that the car had been recovered by the Bronx DA’s detective squad at a parking facility on 6/17/09 with a parking receipt dated 3/21/09, ten days before it was purportedly stolen.
Arrested on 10/13/09
Charged with insurance fraud in the 3rd degree and grand larceny in the 3rd degree
When applying for workers’ compensation insurance, the owner of a roofing business informed the State Insurance Fund that she had only one employee. However an investigation by the Frauds Bureau found evidence that the defendant in fact employed a number of workers but had not claimed them on her commercial workers’ compensation policy. As a result, she failed to pay $25,000 in premiums due to the Fund. When faced with the evidence, she admitted the fraud.
- FORGED SIGNATURE
Arrested on 10/13/09
Charged with forgery in the 2nd degree and grand larceny in the 4th degree
A Buffalo-area bill collector was arrested for cashing workers’ compensation checks sent to her deceased mother. A joint investigation by the Frauds Bureau and the North Tonawanda Police Department uncovered evidence that the defendant did not inform Hartford Insurance Company that her mother had died in February and continued to receive and cash $1,600 in checks issued to her deceased mother.
- NO DEPENDENTS
Arrested on 10/8/09
Charged with grand larceny in the 3rd degree and falsifying business records in the 1st degree
A former employee of Excellus Health Care was accused of falsifying his relationship with his girlfriend and her child in order to obtain health care benefits for them. He claimed that he was married to the woman and was the father of her child when, in fact, he was unmarried and had no dependents. He worked as a customer service representative for Excellus which paid medical and dental claims for the two ineligible dependants under a family plan. His arrest was the result of an investigation by the Frauds Bureau.
- ENHANCED DAMAGES
Arrested on 10/7/09
Charged with insurance fraud
The owner of an auto body shop was charged with enhancing the damages to a 2008 Volkswagen Jetta that was brought into his shop after being involved in a minor accident. An investigation by the Frauds Bureau found that the defendant had enhanced the extent of the damages by more than $4,000.
Arrested on 10/6/09
Charged with offering a false instrument for filing and violation of the Workers’ Compensation Law
On 9/29/08, the president and sole officer of an upstate contracting business submitted an application for workers’ compensation insurance to the State Insurance Fund on which he answered “No” to a question asking if he had previously been insured through the Fund. However, an investigation by the Frauds Bureau uncovered evidence that he had in fact had prior insurance coverage through the Fund for a separate business where he also served as president and sole officer. While he admitted completing the second application, he claimed to be confused by the questions.
- FALSE REPORT
Arrested on 10/2/09
Charged with criminal possession of stolen property in the 3rd degree
A Cambridge, NY, man reported to Selective Insurance Company that his truck and trailer, a Bobcat tractor, tools and two sweepers were stolen. However, an investigation by the State Police, with the assistance of the Frauds Bureau, revealed that the defendant bought the Bobcat from the owner and in fact the owner was still in possession of one of the sweepers. Further arrests in this case are pending.
- WELL ABLE
Arrested on 10/2/09
Charged with criminal possession of stolen property in the 3rd degree
An Ulster County woman who claimed to be totally disabled was arrested for collecting $73,000 in workers’ compensation benefits while she worked at a youth sports camp. While working as a Spanish teacher in Kingston, NY, she allegedly suffered injuries after falling out of a chair and began collecting workers’ compensation. The defendant stated on three occasions that her injuries prevented her from working. An investigation by the Frauds Bureau and the State Police led to her arrest.
- NOT ENTITLED
Arrested on 9/23/09
Charged with insurance fraud and grand larceny
A limousine driver was injured on the job on 11/19/88 and was classified as permanently partially disabled on 2/12/92 and since that time was collecting $150 a week in workers’ compensation benefits. On seven separate occasions, he submitted written attestations to the State Insurance Fund denying any work activity since his accident. However, surveillance conducted by the Frauds Bureau between 2006 and 2008 indicated that the defendant had been working at two local shops in the Bronx. Bank records subpoenaed by the FBI showed that the defendant had business accounts at both shops. Moreover, a loan application from a car dealership showed that he is a self-employed picture framer with a monthly income of $4,000. He failed to inform the State Fund of his work status and collected $21,330 to which he was not entitled.
- FALSE WRITTEN STATEMENTS
Arrested on 9/19/09
Charged with violation of Section 114.1 of the Workers’ Compensation Law
After sustaining a work-related injury, this suspect began collecting workers’ compensation benefits. During the benefit period, he submitted written statements to the State Insurance Fund stating that he was not working in any capacity. However, an investigation by the Fraud Bureau revealed that he was gainfully employed while collecting $63,760 to which he was not entitled.
On 8/4/09, James DeGraff, a sub-contractor for a Greene County developer, was ordered to pay $48,564.84 in full restitution to the State Insurance Fund. He presented three Certificates of Insurance to a general contractor for a work project in the Town of Windham as proof that he had workers’ compensation and general liability insurance coverage as required by New York State Law. However, investigators from the Frauds Bureau, the Fund and Utica First Insurance Company discovered that his coverage had been terminated and he had forged the Certificates. He was arrested on 4/10/09 and charged with criminal possession of a forged instrument in the 2nd degree, falsifying business records in the 1st degree and violation of the Workers’ Compensation Law. In a plea agreement, he pleaded guilty to attempted violation of the Workers’ Compensation Law and criminal possession of a forged instrument in the 3rd degree.