Insurance Fraud Weekly ePort: Week Ending Sept. 21

Insurance Fraud Weekly ePort
Week Ending September 21, 2007
www.InsuranceFraud.org  

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LEGISLATION & REGULATION

* The health committees of the New York Legislature are planning a joint hearing on the state AG’s recent report on home-care fraud. Tens of millions of dollars have been lost to schemes, the report concludes. Attorney General Andrew Cuomo proposed legislation to create a statewide registry for all certified home-health aides. As part of the registry, the aides would have to show they’ve successfully completed a state-approved training program. The legislature would consider the proposal in 2008.

* The Texas Committee on Insurance Fraud will meet with the state Department of Public Safety on Oct. 11 to discuss ways to keep vehicle accident reports out of the hands of recruiters who solicit accident victims for fraudulent injury claims. The legislature failed this year to pass a bill restricting access, and doesn’t meet again until 2009. The coalition is a member of the statewide anti-fraud committee.

Note: Texts of anti-fraud bills are available on the coalition’s website here.

PUBLIC OUTREACH

* “The impact of fraud on seniors can be devastating,” the coalition’s Jim Quiggle warns in a national video news release by AARP about home-repair fraud. “Often (homeowners) have set aside money for repairs and the contractor runs away with their money and doesn’t do the job.” AARP cited the coalition as a national fraud expert in the VNR, which was aired by television stations throughout the U.S.

* “The insurance investigators…seemed to be upbeat and optimistic about the future, much more than in recent years,” the coalition’s Dennis Jay writes in FraudBlog about the recent annual seminar of the International Association of SIUs, held in Las Vegas. “With insurers reporting record profits, the pressure on SIUs to cut expenses likely has lessened, and that ultimately should increase anti-fraud activities over the next few years. The solid attendance at this meeting, combined with a sold-out exhibition hall, suggests the fraud-fighting business is thriving.”

CRIMINAL CONVICTIONS

* Tamara Taylor tried to duck a prison sentence by blaming her mother for her own role in a staged-accident ring. Taylor was convicted as an accomplice in the South Florida ring. But just days before her sentencing, the AG received an anonymous letter claiming Taylor was falsely accused and that her mother was involved instead. Video footage, however, shows Taylor faxing the letter from a convenience store. The ring had stolen more than $100,000 in insurance money with fake injury claims. Members ran their vehicles into stationary objects or staged crashes between two vehicles. Taylor received 18 months.

* Speaking of falsely blaming, Patricia Burton insisted her 100-year-old B&B burned down because firefighters were slow to respond. In fact, she torched the Batavia, Ohio converted farmhouse herself for insurance money. Burton publicly claimed firefighters took half an hour to arrive. In fact, they were onsite within eight minutes. One firefighter was injured as they battled the fire in 98-degree heat. But investigators found traces of lighter fluid and gasoline on the floors of the dining and living rooms. Burton claimed some mysterious person set the blaze, but the court disagreed. She’ll be sentenced October 23.

* Ian Stuart received eight years for inducing agents in the U.S. and Canada to buy more than $8.5 million in fraudulent commercial liability policies. The Ontario, Canada man claimed he was a wholesale broker who could place liability coverage for agents. Stuart also lied that he was authorized by Lloyds of London, Travelers and other insurers. Using fake agency affiliations and pseudonyms, Stuart collected millions in premiums. He was sentenced in federal court in Manhattan on Monday.

* The pressure was too much for convicted pediatrician Dr. Kaled Dabash. The Macomb, Ill. man filed about $3,000 in bogus claims for periods when he was out of the country, and allowed a nurse to treat patients in his absence. Dabash only received 30 months of probation last week. But he’s shutting down his practice and moving his family because he feels he’s under too much attack. Several insurers also no longer will pay his billings. He also faces a looming civil suit by the state, and his medical license is under review.

CRIMINAL CHARGES

* A former insurance agent stole more than $90,000 in premiums and left dozens of homeowners uncovered during the 2005-2006 hurricane season, Florida’s Department of Financial Services said this week. Bruce Anthony Fonte allegedly sold fake homeowner policies to 44 residents during a time when Florida was hit by eight hurricanes. The Port Richey man needed the money to support a gambling addiction, and refunded premiums to some victims when confronted, officials say. The coverage lapses forced several victims to buy homeowner policies through the state’s insurer of last resort, costing them hundreds more in premiums. Several victims couldn’t afford the premium hikes and are living in uninsured houses. A single mother of two still has $8,945 in unpaid homeowner claims for damages to her home by a hurricane in 1995. Fonte faces up to 30 years in prison if convicted.

* Choose your thieves well. Vishal Dhadda apparently didn’t. The Edgewater, N.J. jeweler hired someone to “rob” a satchel of diamonds, sapphires and emeralds so he could bilk his insurer out of $250,000, prosecutors charged yesterday. But the crony actually was a federal agent acting on a tipoff. The agent met with Dhadda. The jeweler allegedly said he’d pay the supposed “thief” $5,000 in cash and jewelry to steal the gems from him in a public place, hit him to enhance the realism, and arrange a paid witness. Dhadda faces up to 10 years for the most-serious charges.

* Pandu Rao-Ippili torched his house for insurance money and made claims for phantom possessions, Maryland officials said this week. The Clarksburg man’s home was vacant at the time. Rao-Ippili claimed he lost a large TV and other items in the fire. But he allegedly told conflicting stories about what possessions he lost. He also poured an accelerant on the first floor, then returned early one morning several days later to light the fire, prosecutors contend. He received flash burns and was treated at a local hospital, officials say. Rao-Ippili says he received the burns while lighting a grill. He faces up to 30 years in prison if convicted.

* Some Christmas present. Calvin Rondel Redding crashed his wife’s 1999 Infiniti SUV into a brick wall last Christmas Eve, but they lied that she was driving because he was excluded from her auto policy, Florida prosecutors charge. Her insurer paid out $7,000, but a police report lists the Jacksonville man as the driver and only occupant.

* Old injuries don’t count, North Carolina prosecutors charged this week. Kathy Ball billed State Farm for nearly $60,000 in fake medical claims using records from a previous stay at a High Point-area hospital, the state insurance department alleges. Ball also forged documents detailing numerous injuries she and her 10-year-old daughter supposedly received, officials allege.

* Andrew Francis collected more than $480,000 in fake medical claims, Arizona prosecutors charge. But none of the claimed medical procedures happened and Francis kept making claims after HeartGen Centers stopped doing business in Arizona, prosecutors allege. Francis is former chief financial officer of HeartGen. He faces up to 40 years in state prison if convicted.

ADMINISTRATIVE & CIVIL ACTIONS

* A Florida man was ordered to stop soliciting public-adjusting business in Louisiana because he isn’t licensed in the state, the insurance department says. David A. Hogan is operating as Utopia Public Adjusting. He advertised on the Internet, in newspaper ads and other outlets. Hogan also represented himself as a licensed adjuster during mediation, the insurance department says. The Port St. Lucie man isn’t licensed in Florida either, officials say.

ETC.

* A recent ad in the Pasco and Hernando (Fla.) Times urges homeowners to file sinkhole-damage claims “even if you do not believe that you have a sinkhole problem.” Several state legislators are incensed over the ad by Michael Mosher, who repairs sinkhole damage and buys sinkhole-damaged homes. Mosher says he meant to say people should have their homes inspected for sinkhole damage before looming changes in sinkhole coverage take place. Many Pasco and Hernando homeowners can grandfather their claims before the policy changes take hold: The revised coverage won’t cover major home damage, according to news reports.

* Iowa says it’s the first state insurance department to bar agents who sell longterm care insurance and annuities from using designations the state hasn’t approved. Insurers also are responsible for ensuring their producers meet standards for using the designations. Some agents use dubious designations such as “senior expert.”

* A Russian émigré tipped off a suspected murder plot in a short story he wrote, investigators say. Eugene Perchikov wrote a self-published short story in which a murder victim is killed with an undetectable injection of norepinephrine. Perchikov, who lives in Israel with his wife, is being investigated by Manhattan prosecutors for possibly using the same drug to kill a lonely Brooklyn divorcee so he could collect $1 million in life-insurance money on her death. Perchikov persuaded Larysa Vasserman and another lover who also died mysteriously to take out large life policies using fraudulent information, civil suits by the women’s families allege. He was the listed beneficiary.

* Medicaid is requiring tamper-proof prescription pads to help stem fraudulent prescriptions beginning Oct. 1. Pharmacies that fill prescriptions on pads that aren’t tamper-proof will be ineligible for Medicaid reimbursement. Pads must meet industry-recognized standards to prevent counterfeiting, erasing or other changes in pads. Each state is responsible for defining what standards must be met to make the pads tamper-proof. North Carolina, for instance, includes measures such as special watermarks and inks. Pads must meet at least one of three security criteria by Oct. 1, and the other two by Oct. 1, 2008. The rule doesn’t apply to prescriptions ordered online, or via phone or fax.

QUOTE OF THE WEEK

“People need to open their eyes to the fact that because these drugs are prescribed by someone in a white coat does not mean they aren’t as addictive and as easily abused as street drugs.”

-Pennsylvania Attorney General Tom Corbett, commenting on a doctor who was arrested by state narcotics agents for allegedly filling prescription pain medication for his own use.

OTHER HEADLINES THIS WEEK

* Two West Virginia workers indicted for comp fraud
* N.J. business executive admits torching his Mercedes
* Probation for Michigan health provider in $800K scam
* Pennsylvania doc accused of self-prescribing painkillers
* Florida adopts new rules to protect military from scams

Details at http://www.insurancefraud.org/news.lasso

MEETINGS & CONFERENCES

* October 25, 2007 — 3rd Annual California Insurance Fraud Symposium
Torrance, CA (The National Underwriter Company)

* December 11, 2007 —Annual Membership & Board Meeting
Washington, DC (Hyatt Crystal City)

For more info, visit online events.