Arrests for November and December 2012
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
Herlina Luis pleaded guilty to grand larceny on 11/20/12 and was sentenced to 3-to-6 years in prison. From 2010 to 2011, she filed approximately 1,000 claims with OptumHealth Behavioral Solutions (OHBS) for reimbursement. OHBS requires claimants who receive treatment from out-of-network providers to pay for those treatments and then file the claims with OHBS. Luis filed claims totaling more than $250,000 for mental health services purportedly provided to her and her family members by a doctor in Brooklyn. However an investigation conducted by the Criminal Investigations Unit Insurance Frauds Bureau and the Manhattan DA’s Office revealed that Luis fabricated both the services and the doctor. OHBS paid out more than $114,000 on the fraudulent claims.
Manhattan podiatrist Alan Shulman was sentenced on 11/19/12 to one year in prison and was ordered to pay an unspecified amount in restitution to CIGNA Insurance Company. From 2008 to 2010, he filed hundreds of claims for treatments that never occurred. He used the patient information of at least five persons to submit claims to CIGNA. In two instances, he accepted payment for claims he filed on behalf of patients, one of whom was in Europe and the other at Disney World when the treatments purportedly occurred. In another instance he contacted a CIGNA member and asked her to report that she had received treatment when she had not. CIGNA paid out a total of $100,671 on the fraudulent claims. He was arrested on 2/4/11 and pleaded guilty to grand larceny on 8/10/12. The investigation was conducted by the Criminal Investigations Unit Insurance Frauds Bureau.
- NOT ENTITLED TO BENEFITS
Arrested on 11/29/12
Charged with insurance fraud in the 2nd degree, perjury in the 1st degree and violation of Section 114.1 of the Workers’ Compensation Law
The defendant in this case submitted a Work Activity Report to the State Insurance Fund and also provided testimony under oath at a Workers’ Compensation Board hearing stating that he was not working. However, during an investigation by the Criminal Investigations Unit Insurance Frauds Bureau and the State Fund, he was observed on surveillance tapes working at a local tavern that he also owns since at least June 2010. As a result, he fraudulently collected $13,129 in benefits.
- CHARGED WITH MURDER
Arrested on 11/23/12
Charged with murder in the 2nd degree
A joint investigation conducted by the Seneca County Sheriff’s Office, the State Police Violent Crime Investigation Team, the Seneca County DA’s Office and the Criminal Investigations Unit Insurance Frauds Bureau led to the arrest of a Romulus, N.Y., man charged with the murder of his 23-year-old son on 11/20/08. At about 4:00 p.m. that day, police responded to a 911 call from the defendant’s wife, at which time the defendant reported that the victim had been working underneath a jacked-up truck in a barn adjacent to their home when he and his wife left for a family event at noon. He stated that when they returned, their son was lying motionless pinned under the vehicle. The Sheriff’s Office reported there were no indications of foul play and the incident appeared to be a tragic accident. However, in March 2012, information came to light that a substantial life insurance policy had been taken out on the victim days before his death naming the defendant sole beneficiary. Moreover, circumstances surfaced that suggested certain actions of the defendant caused the truck to fall off the jack, pinning the victim beneath. The investigation that led to the arrest was conducted over an eight-month period. In addition, investigators from the Sheriff’s Office, the State Police and the CIU Insurance Frauds Bureau are looking into a 1991 fire in California in which the defendant’s first wife died. Insurance Fraud investigators will also conduct an investigation into the circumstance surrounding the purchase of the life insurance policy taken out on the life of the victim.
- PHONY CERTIFICATE
Arrested on 11/21/12
Charged with criminal possession of a forged instrument in the 2nd degree and violation of Section 114 of the Workers’ Compensation Law
An investigation by the Criminal Investigations Unit Insurance Frauds Bureau, the State Insurance Fund and the Workers’ Compensation Board’s Office of the Fraud Inspector General resulted in the arrest of an upstate subcontractor who presented a fraudulent Certificate of Insurance to the owner of a business that provides water and fire damage restoration services. The Certificate falsely stated that the defendant had workers’ compensation insurance coverage for the period of 1/17/11-1/17/12. Based on this erroneous information, his construction company was awarded five jobs in 2011 to which he was not entitled.
- IDENTITY THEFT
Arrested on 11/16/12
Charged with identify theft in the 1st degree, offering a false instrument for filing in the 1st degree and falsifying business records in the 1st degree
On 5/27/10, the Criminal Investigations Unit Insurance Frauds Bureau met with Blue Cross/Blue Shield’s Special Investigations Unit who reported that one of their insureds in Michigan had notified them that a man was using her Social Security number. She gave the man’s name to the insurer’s investigator who learned from company records that the man had submitted medical claims using the true insured’s SS #. Records also indicated that the man was a member of the United Food and Commercial Workers Union. When contacted, the Union confirmed that the imposter had also used the stolen SS # on his employment records. The joint investigation led to his arrest on 11/16/12.
- SUSPICIOUS FIRES
Arrested on 11/15/2012
Charged with insurance fraud in the 3rd degree
On 10/6/11, the Ontario County Sheriff’s Office requested the assistance of the Criminal Investigations Unit Insurance Frauds Bureau in connection with a residential fire in Clifton Springs, N.Y. On 10/5/11, the fire department responded to a 911 call and learned that a woman who co-owns the house with her husband was the last person to leave the house. Witnesses put her in the home 17 minutes before the 911 call. The October 5 fire was the couple’s second residential fire within 18 months and has been ruled an arson by the Fire Coordinator’s Office. The first fire occurred in 2010. During an interview, the woman admitted to investigators that she had removed personal items prior to the 10/5/11 fire but claimed that she was going to stay with her mother because of marital problems. There are charges pending against her in connection with the ongoing investigation into the October 2011 fire. In the meantime, both she and her husband were arrested and charged with insurance fraud for submitting an allegedly fraudulent receipt in support of an insurance claim filed in connection with the 2010 fire.
- FRAUDULENT DOCUMENT FAXED
Arrested on 11/9/12
Charged with insurance fraud in the 5th degree and criminal possession of a forged instrument in the 3rd degree
An investigation by the Criminal Investigations Unit Insurance Frauds Bureau and Zurich American Insurance Company’s SIU led to the arrest of a Wayne County woman who filed a claim for medical treatments she was purportedly receiving for an ankle that was injured in a fall. In support of her claim, the suspect faxed a document to the insurer stating that she was being treated by a specific doctor at a local medical center. However, investigators contacted a medical center staff member who reported that the suspect had never been treated at that center. When faced with the evidence, the suspect confessed that she had in fact faxed a fraudulent document to Zurich.
- CONVICTIONS UPHELD
The conviction of Jeffrey Alnutt in a conspiracy to burn down a home he owned in 2004 was upheld by the Appellate Division of the State Supreme Court on 12/27/12. Alnutt was convicted in 2009 and is serving 5-to-15 years in that case. Alnutt’s daughter, Aubrey Pagan, and his son-in-law, Victor Pagan, were also convicted for their part in the scheme. The jury convicted all three of conspiring to set fire to the home in order to collect an insurance payout of $210,000 on a claim they filed for the loss. Aubrey Pagan received a 1-to-3 year sentence and Victor Pagan received 1.3-to-4 years in prison. All three appealed their convictions. Aubrey Pagan’s appeal was rejected in September 2011 and her husband’s was rejected in July 2012. Jeffrey Alnutt went to trial again in 2010, accused of setting a fire in December 2007 at another building he owned in which a tenant died. He was convicted in that case on 5/10/10 and was sentenced to 25 years to life in state prison. Alnutt has also appealed his conviction in that case. The status of that appeal is currently unclear.
- CLAIMANT FRAUD
Arrested on 12/27/12
Charged with violation of Section 114 of the Workers’ Compensation Law
An investigation by the Criminal Investigations Unit Insurance Frauds Bureau and the State Insurance Fund resulted in the arrest of an upstate man accused of claimant fraud. He filed documents with the State Fund stating that he was not working. However, investigators found evidence indicating that between June 2009 and November 2010, he was employed collecting and scrapping metal. As a result of the fraud, he collected $21,198 in workers’ compensation benefits to which he was not entitled.
- BUSINESS OWNER CAUGHT ON WC FRAUD CHARGE
Arrested on 12/26/12
Charged with violation of the Workers’ Compensation Law
A self-employed business owner was accused of filing false statements related to the operation of a day-care business in Clinton County. Consequently, she fraudulently collected $6,195 in workers’ compensation benefits. Her arrest was the result of an investigation by the Criminal Investigations Unit Insurance Frauds Bureau.
- NO-FAULT FRAUD
Arrested on 12/4/12
Charged with insurance fraud in the 5th degree and attempted petit larceny
The defendant in this case reported to GEICO Insurance Company that he was a passenger in a car when it was involved in an accident on 8/8/11. He further stated that he was driven home from the scene by the responding Rochester Police Officer. Investigators contacted this Police Officer who informed them that he did not see the defendant at the scene of the accident. GEICO’s Special Investigations Unit subsequently reported that the defendant filed a claim for lost-wage benefits as a result of injuries he purportedly incurred in the accident and provided supporting documentation. However, GEICO has not paid the claim due to the inconsistent information submitted by the defendant. The Criminal Investigations Unit Insurance Frauds Bureau, assisting in the investigation at the request of the Rochester Police Department, initially closed the case because they were unable to ascertain the authenticity of documents the defendant submitted regarding his purported injuries. However, during the course of another unrelated investigation, the Rochester PD located the driver of the car involved in the accident who stated that the defendant had been a passenger at the time of the accident but was not injured and fled the scene before the police arrived due to an outstanding warrant against him. Investigators reopened the case and interviewed the defendant who admitted that he had not been injured and left the scene because of the warrant. He also confessed that his statement on the claim that he had missed time at work because of his injuries was false. In fact, he was not employed at the time of the accident. He was arrested on 12/3/12 for attempting to fraudulently obtain $300 in lost wages from GEICO.