New York State
Insurance Department


ISSUED: 5/1/2002

FOR IMMEDIATE RELEASE

DEPARTMENT LAUDS PASSAGE OF RUNNERS BILL IN THE SENATE AND PUSHES FOR CONTINUED AUTO INSURANCE REFORM

          Superintendent of Insurance Gregory V. Serio lauded yesterday’s passage in the New York State Senate of legislation to create new felony crimes for insurance fraud. S.123 is a vital component of an overall auto insurance reform package that is needed to combat fraud and reduce auto insurance premiums in New York State.

          The bill creates a new felony crime for individuals who act as, or solicit the service of, a "runner." A "runner" is a person who obtains clients, patients or customers for health care providers and attorneys that file fraudulent insurance claims. Without this legislation the fraudulent activity of runners could be prosecuted, but no statute explicitly sanctions this insidious practice that fuels fraud rings, bilking consumers out of millions of dollars.

          "The passage of this bill in the Senate is an important step towards allowing consumers to feel confident that they are paying for the insurance coverage they need, not subsidizing the fraudulent activities of scam artists," said Serio. "The bill gives our law enforcement officers and district attorneys the much-needed tools to prosecute and convict criminals who act as "ring masters", procuring claimants to unlawfully obtain benefits, cheat the system and steal money from honest consumers who pay the price in higher auto rates. Being able to prosecute these fraudsters will have a direct impact on the fraud rings – giving us the ability to take them off the street and put them out of business."

          The bill makes acting as a runner a crime punishable as a class E felony.

          "While this bill will protect honest New Yorkers from the mounting costs of fraud and abuse by putting insurance crooks out of business, it has only been passed by the New York State Senate," added Serio. "The Department firmly supports the need for comprehensive auto insurance reform and we look to the Assembly to pass this important piece of legislation—calling for calling for tough-on-crime felony penalties, to best serve all New Yorkers."

          The runners bill is S.123 sponsored by Senator Dean G. Skelos.


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