Arrests for September 2010
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
Aaron Dare, an Albany mortgage broker, was sentenced on 9/30/10 to two consecutive sentences of 4 ½ years in state prison. In addition, a confession of judgment for $1,741,609 was entered. He had pleaded guilty in April 2009 to two counts of grand larceny for his participation in a scam in which he sold properties to individuals who were financially unfit to purchase them. He fronted the down payments and submitted all the applications for the mortgages and title/homeowners insurance policies. He used fictitious information to have the properties appraised at inflated values. Both the buyers and sellers lost on the deals, liens on the properties did not get paid off and Dare pocketed the mortgage money. The Frauds Bureau initiated a case when the State Police requested assistance with their investigation in connection with a fraudulent mortgage/real estate scheme.
Lisa Kline of Albany, NY, was sentenced on 9/28/10 to three to nine years in prison and was ordered to pay $474,000 in restitution. She had pleaded guilty on 8/4/10 to grand larceny in the 2nd degree for her part in stealing $474,000 from Progressive and Mercury Insurance Companies over a ten-year period. The scheme was carried out between 2000 and 2006 while Kline was employed as a claims examiner by Progressive and later when she worked for Mercury. She issued insurance company checks for supplemental payments to policyholders to whom legitimate claims had already been paid. She used false claim numbers, or in some cases, no claim numbers, on the checks. She then forged claimants’ signatures and countersigned the checks, making them payable to herself, or gave the checks to her two co-defendants whom she enlisted to cash checks made out to legitimate claimants who were unaware the checks had been issued. The cases against her co-defendants are pending.
Alexis Muniz, an Ulster County resident, was sentenced on 9/9/10 to three years’ probation and ordered to pay $8,975 in restitution to the State Insurance Fund after pleading guilty to collecting workers’ compensation benefits while fully employed. Investigators discovered a posting on her Facebook page on which she boasted about her job and salary as manager at an apartment complex. She was also accused of stating at a Workers’ Compensation Board hearing that she was not working in any capacity. She had been receiving benefits for a job-related injury while working for a previous employer. Her arrest was the result of an investigation conducted jointly by the Frauds Bureau, the State Fund’s Division of Confidential Investigations and the State Police.
Arrested on 9/30/10
Charged with offering a false instrument for filing and violation of the Workers’ Compensation Law
Following a work-related injury, an Oneida County contractor began collecting workers’ compensation benefits. During the benefit period, he filed several Work Activity Reports with the State Insurance Fund reporting that his injury left him unable to work. However, an investigation by the Frauds Bureau, the State Fund and the Oneida County DA’s Office revealed that he was operating a snow-removal enterprise for local businesses in upstate New York while fraudulently collecting nearly $6,500 in benefits.
- HOTLINE TIP
Arrested on 9/30/10
Charged with insurance fraud in the 3rd degree, grand larceny in the 3rd degree, falsely reporting an incident and false written statement
The defendant in this case reported to the NYPD and GEICO Insurance Company on 8/15/10 that her 2006 Lexus IS250 had been stolen. However, based on information obtained from the National Insurance Crime Bureau’s Hotline, an investigation conducted by the Frauds Bureau and the NYPD revealed that the car was never stolen. The defendant was interviewed and confessed to the fraud.
Arrested on 9/30/10
Charged with grand larceny in the 3rd degree and falsifying business records in the 1st degree
A client of a Rockland County insurance agency purchased a commercial general liability insurance policy from the father/son owners of the business. The client made a down payment of $9,415 on an $18,831 policy and arranged for the agency to have the remainder handled by a premium finance company. The client subsequently made seven payments totaling $7,763 to the agency. However, an investigation by the Frauds Bureau and the Rockland County DA’s Office revealed that the client was overcharged for coverage that should have cost $5,200. Moreover, only one payment of $466 was made to the finance company. The policy was cancelled for nonpayment of premium and the suspects were accused of stealing more than $10,000 from the client. Both they and their company were charged in the case.
- LEFT THE SCENE
Arrested on 9/28/10
Charged with falsely reporting an incident, offering a false instrument for filing and false written statement
A Queens man reported to the NYPD’s Auto Crime Division that his 1995 Honda Accord had been stolen on 3/14/10. However, police records showed that the car had been involved in an accident and the driver had left the scene. During an investigation by the Frauds Bureau and the Auto Crime Division, the car was recovered on 4/27/10. The suspect was interviewed and admitted to filing the false theft report in an attempt to cover up his connection to the accident.
- LEFT THE SCENE 2
Arrested on 9/27/10
Charged with insurance fraud in the 3rd degree
An investigation by the Frauds Bureau and the NYPD resulted in the arrest of a Brooklyn woman who allegedly crashed her car into a building while driving. She fled the scene and went to a NYPD precinct to report the car stolen. She subsequently filed a claim with Allstate Insurance Company for the loss.
- TOO LATE
Arrested on 9/23/10
Charged with insurance fraud in the 3rd degree
Following an auto accident on 11/3/09, the defendant in this case realized that she did not have collision coverage to cover the loss. About an hour after the accident, she called GEICO Insurance Company and added the coverage to her policy. However, she failed to report the accident to the insurer until 11/6/09, stating at that time that the accident had occurred on 11/5/09. She also filed an accident report with the Troy Police Department repeating the incorrect accident date. During an investigation by the Frauds Bureau and the Troy PD, the defendant was interviewed and gave a written statement admitting the fraud.
- NO CHARGE FOR BACKYARD REPAIRS
Arrested on 9/23/10
Charged with forgery in the 2nd degree
An investigation in which the Frauds Bureau joined forces with GEICO Insurance Company’s SIU led to the arrest of a Rochester man who was charged with submitting a receipt for $3,423 worth of repairs that had purportedly been made to his 2007 Chevy Malibu. He submitted the receipt in support of a claim filed with GEICO for the repair work. However, the investigation revealed that he had produced the receipt himself and then forged the name of the repair shop owner. In fact, no repairs had been made to his car at any repair shop. The defendant made some repairs in his backyard but never completed the job. When interviewed, he confessed that he had submitted the fraudulent document in order to collect an insurance payout.
- STRIKE FORCE SUCCESS
Arrested on 9/22/10
Charged with one count of health care fraud
An investigation by the Medicare Fraud Strike Force, of which the Frauds Bureau is a member, led to the arrest of a medical doctor specializing in colo-rectal surgery on charges that from 2/09 to 1/10, he defrauded Medicare and numerous other health care benefit programs of at least $3.5 million. Investigators began reviewing the doctor’s practice after receiving complaints from patients who said the doctor had submitted claims for services they had not received. He allegedly consistently filed claims for office visits, examinations and subsequent surgical procedures as if he were treating unrelated conditions, when in fact he was providing follow-up services related to an initial procedure. In addition, he often billed for working more than 24 hours in a day. A search warrant was executed at his office on the day of his arrest and bank records were seized.
The Medicare Fraud Strike Force supplements the criminal health care fraud enforcement activities of the U.S. Attorney’s Offices by targeting chronic fraud as well as emerging or migrating schemes perpetrated by criminals operating as health care providers or suppliers. The Strike Force members include the Department of Justice Criminal Division’s Frauds Section, law enforcement partners in the Department of Health and Human Services (HHS), the New York Insurance Frauds Bureau and other state and local law enforcement agencies.
- 695 COUNTS OF FORGERY
Arrested on 9/21/10
Charged with insurance fraud in the 2nd degree, grand larceny in the 2nd degree, and 695 counts each of forgery and possession of a forged instrument
A Queens accountant was arrested for filing 695 fraudulent health insurance claims totaling more than $115,000 with Aetna and United Healthcare Oxford from 11/09 through 5/10. She filed several apparently legitimate claims and then forged the health care providers’ paperwork to file the bogus claims. In submitting the claims, she used the names of three out-of-network providers in order to be paid directly, rather than having the payments made to in-network providers. Of the total amount the defendant was paid, $65,000 was for a psychologist’s care that was never provided. All but 54 of the claims were paid by Aetna. Her arrest was the result of an investigation conducted jointly by the Frauds Bureau and the Queens DA’s Office.
Arrested on 9/17/10
Charged with grand larceny in the 4th degree and criminal possession of a forged instrument in the 2nd and 3rd degrees
The Frauds Bureau received a complaint from an insured that she had paid $1,800 to a New York State-licensed insurance agency for auto insurance but the premium was not remitted to the insurance company. Moreover, she reported that the broker had given her fraudulent insurance ID Cards. A number of other complainants contacted the Department’s Consumer Services Bureau and the Suffolk County DA’s Office to report the broker for misappropriation of premiums. Following an investigation, a search warrant was executed at her business office on 4/16/10 and she surrendered herself to the DA’s Office on that same day. The case was presented to a grand jury and she was indicted on 9/2/10. She was arrested on 9/17/10 on charges of two counts of grand larceny in the 4th degree, three counts of criminal possession of a forged instrument in the 2nd degree and one count of criminal possession of a forged instrument in the 3rd degree.
- NOT THE OWNER
Arrested on 9/14/10
Charged with insurance fraud in the 4th degree and falsifying business records
An investigation by the Frauds Bureau and the Nassau County DA’s Office resulted in the arrest of the owner of an auto body shop in Nassau County. The suspect took possession of a 2007 Chrysler PT Cruiser that had been involved in an accident with a GEICO policyholder and was declared a total loss. The suspect filed a claim in the name of her business with GEICO in the amount of $12,492, including $991.88 in sales tax. However, investigators learned that the claim included a fraudulent list of repair expenses, a false bill of sale and forged Department of Motor Vehicle forms naming the suspect as the owner of the car.
- 38 AND COUNTING
Arrested on 9/13/10
Charged with insurance fraud
An ongoing no-fault investigation being conducted by the Frauds Bureau and the NYPD’s Fraudulent Accident Investigations Squad led to the arrest of a New York City woman who was charged with intentionally crashing her vehicle into another vehicle. The defendant subsequently received medical treatment for nonexistent injuries and filed claims with GEICO Insurance Company for the expenses. Thirty-seven other defendants have previously been arrested in connection with this investigation.
- OWNER GIVE-UP
Arrested on 9/9/10
Charged with insurance fraud in the 3rd degree, falsifying business records in the 1st degree and falsely reporting an incident
In a case involving an owner give-up, a New York City man reported to the NYPD that his 2004 BMW had been stolen. He was arrested after an investigation by the Frauds Bureau and the NYPD’s Auto Crime Division revealed that prior to the theft report, he had sold the car to a used-car dealership in New Jersey. The car was resold by the dealership and recovered in the possession of the new owner. His unsuccessful plan was allegedly to cash in on the insurance proceeds.
- UPSTATE ARREST SWEEP
Arrested on 9/9 and 9/1/10
Charged with violation of the Workers’ Compensation Law
The defendant in this case was the seventh suspect arrested as part of a three-county sweep conducted by the Frauds Bureau, the Workers’ Compensation Board’s Office of the Fraud Inspector General, the State Insurance Fund, the State Police, the Albany County Sheriff’s Department and the Albany, Rensselaer and Dutchess County DAs’ Offices. Using surveillance, investigators observed the defendant walking freely and carrying a walker under his arm before he testified at a hearing that a job-related injury left him unable to walk or stand unassisted. A sixth suspect was arrested on 9/1/10 for allegedly collecting $6,037 in benefits to which he was not entitled. While employed as a maintenance worker for the Wynantskill School District, he sustained a job-related injury and filed a claim for workers’ compensation benefits on 11/4/05. During the benefit period, he submitted seven Work Activity Reports to the State Insurance Fund reporting that he was not working. However, an investigation uncovered evidence that he was employed at a local construction company owned and operated by his son.
Five additional suspects were swept up in August: two fraudulently collected benefits while working; another cashed nine checks issued to her deceased father-in-law; a fourth suspect was charged with providing false information on an application for workers’ compensation insurance in order to avoid $11,000 in past premiums due; and the fifth submitted a fraudulent Certificate of Insurance in order to obtain work contracts.
- DATES ALTERED
Arrested on 8/31/10
Charged with forgery in the 2nd degree
An investigation by the Frauds Bureau and the Monroe County Sheriff’s Office led to the arrest of the wife of a remodeling business owner. She was accused of faxing an ACORD Certificate of Insurance to a contractor as proof that the business had workers’ compensation and commercial liability insurance coverage as required by New York State Law. However, the investigation revealed that she had altered the effective coverage dates on an outdated Certificate and no coverage was in place. In fact, investigators learned, the business had not had valid insurance coverage since October 2001. During an interview, the defendant admitted that she had forged the Certificate so that her husband could maintain a snow-plowing contract. On 8/31/10, she surrendered herself to the Sheriff’s Office and was charged.
- BOYFRIEND CAUGHT
Arrested on 8/20/10
Charged with unauthorized use of a vehicle in the 3rd degree and leaving the scene of an accident under the Vehicle and Traffic Law
A Long Island woman reported to the Nassau County Police Department that her car had been stolen. However, an interview conducted by a detective from the PD with the insured and other witnesses in the case uncovered evidence that the vehicle had not been stolen. In fact, the insured’s boyfriend had taken the car without her permission and was involved in an accident while driving. Moreover, he left the scene without reporting the accident. Based on a statement investigators subsequently obtained from the girlfriend, the suspect was arrested.
Dr. Anthony LaTona, a Queens chiropractor, was sentenced on 7/14/10 to a conditional discharge and waived his rights to future claims totaling $8.5 million. He was convicted on 6/3/10 of insurance fraud in the 3rd degree after investigators found that he convinced a “patient” to fabricate injuries and then billed Empire Blue Cross and Blue Shield more than $26,000 for medical treatments over a three-month period. He paid a $1,000 kickback to the “patient” who was actually an undercover investigator. At a meeting on 9/16/08, LaTona instructed the undercover to fake back and knee injuries in order to obtain insurance payments.