CFO SINK ANNOUNCES MIAMI-DADE FRAUD ARRESTS

The following information was just released by Chief Financial Officer Alex Sink’s Press Office:

MIAMI-Florida Chief Financial Officer Alex Sink announced arrests today of individuals accused of various insurance fraud schemes including auto body damage, Personal Injury Protection (PIP), and hurricane claim fraud.  Two of those arrested face up to 55 years in prison on multiple felony charges and are suspected to be the ringleaders in organizing more than 70 “paper” motor vehicle crashes since 2003.

The arrests stem from investigations by the Department of Financial Services, Division of Insurance Fraud (DIF), a sworn statewide law enforcement agency that last year made more than 800 arrests and currently leads the nation’s fraud bureaus in the number of cases presented to prosecutors and the amount of court-ordered restitution.

“The arrests we are announcing today represent another victory for consumers as we continue to root out fraud that increases rates that Floridians pay,” said CFO Sink, who oversees the Department.  “I want to assure Floridians that even after the sunset of No-Fault, we will continue to vigorously pursue those who defraud the system and put our officers’ lives at risk.”

Among the arrests CFO Sink announced today were Jesus Joel Trujillo, 44, and his mother, Elda Castro, 63, both of Homestead, who were arrested at their homes this morning for creating auto crashes on paper and sending fraudulent claims to at least six different insurance companies. 

The two were booked into the Miami-Dade County Jail on nine counts each of grand theft and one count each of organized fraud.  Bond was set at $52,500 for each. If convicted on the charges, they face up to 60 years in prison.  The Miami-Dade County State Attorney’s Office is prosecuting the charges.

Trujillo and Castro allegedly set up fictitious auto body shop corporations along with corresponding bank accounts to make it appear they were conducting legitimate business, then obtained several vehicles and damaged them to look like they had been involved in crashes.  Then, other individuals were recruited, ownership of vehicles was transferred among participants and claims were filed with their insurance companies for crashes that never occurred.

To support fraudulent claims, Trujillo allegedly would locate particular models of vehicles in which the participants had claimed to have had accidents and then use the name and vehicle information of the unsuspecting vehicle owner as the claimant, and another participant in the scheme would pose as the driver of those targeted vehicles during contact with the insurance companies.  

Detectives said insurance checks were deposited into one of two bank accounts that Trujillo and Castro had established. Corporation and bank records showed one account, Jesse T. Enterprises, Inc., was a residential address in Hialeah, while the second account, E&R Paint and Body, Inc., was Castro’s home address.

Through investigations by both the insurance companies’ Special Investigations Units, the National Insurance Crime Bureau (NICB) and the DIF it was determined that damaged vehicles were used over and over for the claims, including one vehicle used eight times.  Insurance companies paid out $32,827.23 in fraudulent claims in this case.

Other arrests CFO Sink announced today:

• Johnny Hill, 33, Miami, for knowingly purchasing a fake State Farm insurance card.  Johnny Hill purchased the fake card for $50 and then gave the card to his mother to present to the insurance company.  Hill is charged with one count of possessing a fake insurance card and faces up to five years in prison if convicted on the charge.

• Milagros Pedraza, 46, Miami, and Susana S. Estevez, 55, Miami, are accused of participating in a staged auto crash that resulted in more than $11,000 in fraudulent PIP claims through a Hialeah clinic, Havana Treatment Center.  The staged crash occurred on January 26, 2006.  The three were booked into the Miami-Dade County Jail and face a minimum mandatory sentence of two years in prison if convicted.

• Amalia Soto, 37, Miami, charged with insurance fraud and grand theft.  She allegedly altered a receipt for replacement of an air conditioning unit following Hurricane Wilma and submitted to First Community Insurance Company a claim for $3,290 instead of $2,200. She was booked into the Miami-Dade County Jail.  If convicted, she faces up to five years in prison.

• Rogelio Alonso, 41, Miami, owner of Gables Medical Center, Corp, and clinic therapist, Marcia Alonso, 49, Miami, both charged with insurance fraud and grand theft for fraudulent bills in excess of $8,000 for alleged treatment of two participants in a staged accident.  If convicted on the charges, they both face up to 10 years in prison.

• Eran Oliva-Sotomayor, 40, Miami, therapist at T&A Diagnostic Center, and Larry Yanez, 20, Miami, the latest arrests as a result of an undercover sting operation called “Operation TGIF” that netted 33 people in June.  That operation, initiated by a call to the DFS’ fraud hotline following an interview of DIF detectives on a local radio show, identified 10 staged accidents between December 2006 and April 2007, which resulted in more than $328,000 in fraudulent PIP claims.

CFO Sink emphasized that while Florida’s No-Fault Law and the requirement to carry PIP coverage are set to expire on October 1, 2007, DIF detectives will continue to investigate PIP fraud for several years because these criminal charges carry a five-year statute of limitations.  “Floridians should continue sending in tips and referrals so we can work together to hold individuals responsible for this costly crime,” said CFO Sink.

For more information on the expiration of Florida’s No-Fault Law, visit www.myfloridacfo.com and click on Life without No-Fault.

The Department of Financial Services, Division of Insurance Fraud, investigates various forms of fraud in insurance, including health, life, auto, property and workers’ compensation insurance. Anyone with information about this case or another possible fraud scheme should call the department’s Fraud Hotline at 1-800-378-0445.  A reward of up to $25,000 may be offered for information leading to an arrest and conviction.

As a statewide elected officer of the Florida Cabinet, Chief Financial Officer Alex Sink oversees the Department of Financial Services, a multi-division state agency responsible for management of state funds and unclaimed property, assisting consumers who request information and help related to financial services, and investigating financial fraud. CFO Sink also serves as the State Fire Marshal.

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For more information, please contact either Nina Banister or Brannon Jordan at (850) 413-2842 or (850) 528-1008.

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