Arrests for November 2011
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 1-888-372-8369
CAUGHT!
*********************************************
- SENTENCED
On 11/8/11, Kathleen Dominy was sentenced to six months in prison and ordered to pay $247,391 in restitution for her part in a scheme to defraud numerous medical insurance providers by submitting fraudulent claims. She was originally arrested on 10/23/03 and subsequently pleaded guilty to one count of health care fraud. A co-defendant in the scheme, Vitina Warner, was sentenced on 9/29/11 to 30 months in prison and ordered to pay $2.6 million in restitution. Warner billed massages as physical therapy and also billed for services not provided. She was originally arrested on 11/11/03 and pleaded guilty to health care fraud and obstruction of justice. An investigation conducted jointly by the Insurance Frauds Bureau and the FBI led to the arrests.
On 11/4/11, chiropractor Christopher Fronczak was sentenced to five years’ probation and ordered to pay $199,999 in restitution to Excellus BlueCross BlueShield. From 2005 through 2009, he submitted more than $200,000 in fraudulent claims to Excellus. In numerous cases, he provided routine services but submitted claims for more expensive treatments. In other instances, he billed for services that were not provided and for visits that never took place. On 5/11/11, Fronczak surrendered himself to investigators at the Insurance Frauds Bureau’s Rochester Office and pleaded guilty to federal health care fraud. The investigation was conducted by the IFB and the FBI.
- CONVICTED
Thomas Douglass of Marlboro, NY, was convicted on 11/23/11 of insurance fraud and falsifying business records. In October 2009, he reported to State Farm Insurance Company that he had been involved in a deer collision accident and he filed a $12,570 claim for the damage to his car. However, an investigation by the Insurance Frauds Bureau uncovered evidence indicating that he was actually involved in a hit-and-run personal injury accident and fled the scene.
- WORKERS’ COMP FRAUD
Arrested on 11/29/11
Charged with violation of Section 114.1 of the Workers’ Compensation Law
A Brooklyn man reported that he fell as he exited an elevator after completing an extermination job, injuring his neck and shoulder. However, an investigation conducted by the Insurance Frauds Bureau uncovered videotape taken by security cameras inside the building where the defendant claimed he fell. The tape showed him using the stairs rather than the elevator to exit the building. The trip was made without incident. As a result of the fraud, he collected $34,060 in workers’ compensation benefits to which he was not entitled.
- FRAUDULENT CLAIMS
Arrested on 11/28/11
Charged with insurance fraud
A Long Island business owner purchased a health plan from Oxford Insurance Company for himself and his sister, who was listed on documents submitted to Oxford as an employee of his company. The insurer subsequently paid $130,000 in medical bills for the sister. However, when interviewed during an investigation by the Insurance Frauds Bureau and the Suffolk County DA’s Office, she admitted that she was not an employee. Her brother was arrested and charged with insurance fraud.
- OWNER GIVE-UP
Arrested on 11/21/11
Charged with insurance fraud in the 3rd degree, attempted grand larceny in the 3rd degree and making a punishable false written statement
The defendant in this case reported to the Suffolk County Police Department that her 2005 Chrysler had been stolen from her driveway. She stated that she had last seen the car on 9/20/11 at 11:30 p.m. and found it missing the next morning. However, investigators learned that the FDNY responded to a passenger car fire on 9/20/11 at 9:35 p.m. in Brooklyn. The recovered vehicle was identified as the same one reported stolen by the defendant. Her arrest was the result of an investigation by the Insurance Frauds Bureau and the FDNY Fire Marshals.
- TEN-COUNTY ARREST SWEEP NABS 19
Arrested on 11/2-17/11
Charged with workers’ compensation fraud and related crimes
An arrest sweep covering ten upstate counties and conducted over the course of the month of November netted 19 suspects. Fifteen of the suspects were found to be working while fraudulently collecting benefits. Three suspects falsely reported that their injuries occurred on the job when in fact they had not. The final suspect cashed seven benefit checks that were issued to her deceased husband. All told, the 19 suspects fraudulently collected benefits in amounts ranging from $1,790 to $53,760. The arrests of two other suspects are anticipated. They allegedly engaged in a conspiracy to file false information regarding an incident involving a suspect already arrested. This suspect, a teacher aide, claimed she broke her ankle on the job when the accident actually happened at her home. The sweep was conducted in the following counties: Oneida, Ulster Otsego, Warren, Chenango, Clinton, Tompkins, Albany, Jefferson and Schenectady.
- PARTICIPATION FOR MEMBERS ONLY
Arrested on 11/17/11
Charged with insurance fraud in the 2nd degree, grand larceny in the 2nd degree, falsifying business records in the 1st degree and scheme to defraud in the 1st degree
The president and CEO of the Otsego County Chamber of Commerce was arrested for his participation in an allegedly fraudulent health insurance scheme. He enrolled New York City residents in the Chamber’s health plan by maintaining they were Chamber members and offering them lower rates than they would have paid for coverage in the New York City area. He enrolled residents outside of Otsego County in the Chamber’s legitimate health plan after he created a non-existent “associate member” designation for them. These enrollees were unaware they were fraudulently listed as Chamber members. When the scheme was discovered, the 400 City enrollees and 120 legitimate Otsego County enrollees lost their coverage. Coverage for the Otsego County enrollees was subsequently reinstated under a new plan. MVP Health Care provided the plan coverage and contacted the Insurance Frauds Bureau when an unusual spike in new enrollments was noticed, with many of the enrollees residing outside of Otsego County. MVP paid more than $654,000 in claims for medical treatments, plus $285,000 for prescription drugs for those members fraudulently enrolled. In addition, MVP lost more than $135,000 in premiums.
- WHO’S THE OWNER?
Arrested on 11/17/11
Charged with grand larceny in the 2nd degree, insurance fraud in the 2nd degree, falsifying business records and violation of Section 114.1 of the Workers’ Compensation Law
A Queens couple was arrested for participating in a scheme to defraud the State Insurance Fund. The wife submitted an application to the Fund for workers’ compensation insurance for an iron works company she purportedly owned. On the application she was listed as the sole owner of the company and she reported that she had not previously purchased insurance coverage through the Fund. However, an investigation by the Insurance Frauds Bureau revealed that there was a prior policy for the company which was cancelled for nonpayment of $52,081 in premiums owed to the Fund. That policy listed her husband as the sole owner.
- SERVICES NOT RENDERED
Arrested on 11/17/11
Charged with grand larceny
A joint investigation conducted by the Insurance Frauds Bureau and the New York State Office of Medicaid Fraud led to the arrest of a Rochester optometrist for allegedly billing for services that he did not provide. As a result, he fraudulently obtained $36,752 from Excellus Health Plan and $3,946 from Medicaid. Investigators learned that he was a salaried employee at an eye-care center and had no authority to submit bills to insurers. When interviewed, the defendant confessed to submitting the fraudulent claims.
- DELIVERY MAN COLLECTS BENEFITS
Arrested on 11/17/11
Charged with grand larceny, insurance fraud, perjury and offering a false instrument for filing
A Nassau County man began collecting workers’ compensation benefits following a job-related injury in November 2009. However, an investigation by the Insurance Frauds Bureau revealed that he was employed as a delivery man for a local pizzeria during the benefit period. As a result, he collected $5,393 in benefits to which he was not entitled.
- CAR SOLD, NOT STOLEN
Arrested on 11/15/11
Charged with insurance fraud and attempted grand larceny
An upstate man reported to New York Central Mutual Insurance Company that his vehicle had been stolen on 5/6/11 and filed a $3,856 claim for the loss. However, an investigation by the Insurance Frauds Bureau revealed that he had sold the vehicle prior to the reported theft. When interviewed, he confessed to submitting the fraudulent claim in an attempt to collect the insurance payout.
- SAME PROPERTY SOLD TWICE
Arrested on 11/15/11
Charged with grand larceny in the 2nd and 3rd degrees and criminal tax fraud in the 3rd degree
The Insurance Frauds Bureau received a referral from Fidelity National Title in March 2010. The referral indicated that a residential property located at 238 Delmar Ave., Staten Island, NY, was sold twice within weeks to two different purchasers. On 12/16/08, the defendant sold the property in question to James Samuel for $720,000. The mortgage was recorded on 2/19/09. On 12/30/08, the defendant sold the property again, this time for $100,000, to RP Family Inc. Trustar Funding LLC loaned $115,571 to finance this sale. On 2/26/09, RP Family made a $450,000 claim against the title company alleging defect in title, thus revealing the scheme. An investigation conducted by the Insurance Frauds Bureau and the Staten Island DA’s Office led to the arrest in this case.
- MISAPPROPRIATION
Arrested on 11/9/11
Charged with grand larceny in the 2nd degree
On 11/9/11, a New York City property/casualty broker was charged with grand larceny when investigators learned that from December 2008 to April 2009, he collected $261,000 in premiums from numerous clients for the purchase of directors and officers insurance. However, he allegedly failed to remit the money to an insurer. The Insurance Frauds Bureau pooled resources with the Attorney General’s Office in the investigation that led to his arrest.
- FRAUDULENT RECEIPT
Arrested on 11/2/11
Charged with insurance fraud
A Corning, NY, man reported that a high-end bicycle was stolen during a burglary at his home. He filed a claim with State Farm Insurance Company for the loss and included a receipt as proof that he had purchased the $3,455 bicycle at a local shop. However, an investigation by the Insurance Frauds Bureau found evidence indicating that no such purchase was made and the receipt was fraudulent.
- FIRE INTENTIONALLY SET
Arrested on 11/2/11
Charged with arson, endangering the welfare of a child, attempted cruelty to animals, conspiracy, perjury and hindering prosecution
A Schenectady County grand jury indicted four suspects for their involvement in a fire that occurred on 7/9/11. One suspect was charged with arson for allegedly blowing up two small portable propane tanks in the oven of his apartment while upstairs tenants, including a child and a dog, were at home. The other suspects were charged with conspiracy, perjury, hindering prosecution and related crimes. The suspects were gone by the time firefighters responded. The fire was confined to the kitchen and no one was hurt. The Schenectady County DA’s Office requested assistance from the Insurance Frauds Bureau in preparing the case for the grand jury.
- 60th DEFENDANT ARRESTED
Arrested on 11/1/11
Charged with insurance fraud and falsely reporting an incident
An ongoing investigation into no-fault fraud led to the arrest of a Brooklyn man charged with larceny. He intentionally crashed his vehicle into a bicycle for the purpose of defrauding Progressive Insurance Company for monetary gain. The defendant falsely reported the “accident” to Progressive and was subsequently treated for nonexistent injuries. As a result, Progressive paid more than $2,000 for unnecessary medical treatment. This defendant is the 60th defendant to be arrested in connection with this long-term investigation being conducted by the Insurance Frauds Bureau and the NYPD’s Fraudulent Accident Investigation Squad.
