Showing posts with label Auto Insurance Fraud. Show all posts
Showing posts with label Auto Insurance Fraud. Show all posts

Tuesday, May 29, 2012

Beverly Hills Dentist And His Office Manager Charged With Insurance Fraud by Los Angeles D.A.'s Office - Nurse Charged In Related Case


A Beverly Hills dentist and his office manager have been charged with insurance fraud and other felony counts in a state criminal case pending in Los Angeles County Superior Court. 
On May 3, 2012, the Los Angeles County District Attorney's Office (Healthcare Fraud Division) charged Beverly Hills dentist Tom Kalili on a 101 felony count complaint (Case No. BA394506) alleging insurance fraud, grand theft and tax evasion. The allegations relate primarily to Dr. Kalili's acts as the owner and operator of Beverly Hills Medical Suite (BHMS). The office manager Claudia Ventura was also charged with ten felony counts.
A felony complaint is only an accusation and is not evidence of guilt. Dr. Kalili and Ms. Ventura are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.  
What is alleged in the criminal complaint? It is a wide-ranging complaint. First, according to detectives from the California Department of Insurance (CDI), Dr. Kalili, acting as the owner and operator of BHMS, directed his office manager Ms. Ventura to knowingly submit fraudulent billing statements to four separate insurers in the amount of $339,799.99. 
It is alleged that BHMS submitted billing for services not rendered and in most cases the billing involved emergency dental procedures that were never performed. It is also alleged that BHMS submitted false medical reports in support of the fraudulent billing, which generally included fictitious mechanisms of injury.
Second, the investigators looked at Dr. Kalili's own insurance claims for automobile accidents and filed counts relating to them. The case alleges that Dr. Kalili submitted two fraudulent insurance claims on behalf of himself and his son to two automobile insurers. These claims included medical reports alleging he received treatment in auto accidents in 2005, 2008 and 2009 and his son for treatment received for injuries sustained in a 2009 auto accident. The detectives contend that these medical reports were fraudulently prepared and that the dentist listed as providing treatment for the injuries claimed by Kalili denied performing the services listed.
Third, the complaint alleges counts relating to tax counts: filing false tax returns/failure to file tax returns and tax evasion.  
In a related case, Marti Quinn, a nurse who allegedly received over $11,000 from a fraudulent claim submitted by BHMS was charged in a separate criminal case with insurance fraud. 

Commentary:  It appears that this case was under investigation since June 2010 after a report was sent to the California Dept. of Insurance, fraud division, that BHMS was submitting fraudulent medical bills for emergency dental work that was not provided to patients. Thus, these type of cases generally take a long time to investigate and charge.
This investigation involved a number of different agencies and companies: the California Dental Board, California Department of Insurance, California Franchise Tax Board, Anthem, United Health Care, Blue Shield, CIGNA, AAA, and Mercury Insurance. With computerized records, coordinated investigations are easier to conduct and becoming more common.
I am seeing a trend in investigating whether the medical provider has submitted fraudulent claims relating to his or personal life. This allows the government to bring in evidence that the person has engaged in other bad conduct and allows them an alternative theory at trial if there are viable defenses in billing related to their business.

As a condition of bail, the Superior Court issued an order while this case was pending precluding Dr. Kalili from submitting any insurance claims or engaging in any "insurance billing activity" while this case was pending. Otherwise, the dentist can continue to practice while this case is pending.  
Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation. 
Any questions or comments  should be directed to Tracy Green, a very experienced insurance fraud attorney and dentist attorney at tgreen@greenassoc.com. The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers in criminal matters in California and throughout the country. Their website is: http://www.greenassoc.com

Sunday, November 7, 2010

Two Los Angeles Rookie Police Officers Charged With Auto Insurance Fraud

A Los Angeles police officer accused of making arrangements for his vehicle to be set ablaze and a fellow officer were charged on October 18, 2010 with automobile insurance fraud. The Los Angeles County District Attorney's Office, Auto Insurance Fraud Division, filed the complaint in Los Angeles County Superior Court, Case No. BA376806.  California Department of Insurance is the investigating agency.

Anthony Robert Villanueva, 24, is charged with one count each of insurance fraud, arson of one’s own property and false report of a criminal offense. Co-defendant Ricardo Rebolledo, 27, faces one count of insurance fraud.  Both defendants are presumed innocent and a criminal complaint is not evidence. 

Prosecutors allege that in April 2010, Mr. Villanueva arranged for his 2001 Lexus sedan to be taken to the desert and set on fire, resulting in a total loss. Mr. Villanueva then purportedly filed a stolen vehicle report with the Los Angeles Police Department (LAPD) and submitted a claim for damages to his automobile insurance company.

Co-defendant Mr. Rebolledo allegedly provided a fraudulent statement to Mr. Villanueva’s insurance company in support of the claim vouching for his friend’s whereabouts on the day of the supposed vehicle theft.Each defendant has been employed by the LAPD since September 2009. The recommended bail for Mr. Villanueva was $75,000 and $25,000 for Rebolledo.

If convicted as charged, Mr. Villanueva faces a maximum state prison term of six years, two months and a fine of up to $50,000. Mr. Rebolledo faces a maximum term of five years in state prison.

Attorney Commentary: Although it is surprising to see two police officers charged with such an offense, they are young and were officers for less than a year before the alleged offense was committed.  The speed with which this case was investigated and charged was unusual (6 months) especially in a fraud case. The case may have been expedited due to the suspects being police officers.  A case like this will be harmful in more ways than one since both men will face investigation and potential disciplinary charges from LAPD due to the filing of this case. 

Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates in Los Angeles, California. The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing individuals and companies in fraud investigations and federal and state cases, including auto insurance fraud. Their website is: http://www.greenassoc.com/

Friday, June 18, 2010

New York DME Health Care Fraud Case: 17 Individuals Charged and 12 DMEs Searched In Federal Criminal Case Involving "No Fault Insurance" Billing

On June 15, 2010, four indictments were unsealed in the Eastern District of New York charging 17 individuals for their participation in alleged health care fraud and money laundering schemes in the Eastern District of New York. In addition, 12 durable medical equipment (DME) retail companies located in South Brooklyn that were operated by the charged individuals were searched.

Four of the DME businesses in Brooklyn that were searched were Kristar, Inc., Promed Supply Co., Inc., Dorsi Medical Supply Inc.,
DB Supply Inc./Avgur. The government also seized assets from bank accounts maintained by the retail DME companies owned by the charged individuals.

It must be remembered that the charges announced by the U.S. Attorney's Office today are merely allegations, and the defendants are presumed innocent unless and until proven guilty.

According to the indictments, the DME company owners and operators filed fraudulent claims with private insurance companies with no-fault insurance plans. Specifically, it is alleged that the DME companies   submitted false invoices for durable medical equipment to the insurance companies in two ways: (1) by charging prices well in excess of the price paid by the companies, and (2) by billing for equipment that was never obtained.

There is a money laundering allegation as well since the indictments allege that the charged individuals engaged in financial transactions to conceal the identity, source, and destination of the fraudulent proceeds by “laundering” them through checks they issued to the same wholesale companies. The checks were then negotiated at check cashing stores and the resulting cash was delivered back to the defendants.

The charged individuals are: Aleksandr Afanasev (age 44), Leksandr Afanasev (age 44), Eduard Budrunov (age 49), Grigory Branfenbrener (age 57), Gennadiy Bronshteyn (age 51), Lyubov Groysman (age 56), Vladimir Khmelnitski (age 45), Iliya Mugerman (age 46), Bela Rud (age 38), Viktor Semerik (age 44), Arkadi Shapiro (age 59), Denis Zagladko (age 29), Igor Shturman (age 48), Mariya Gomelskaya (age 27), Igor Vetukh (age 50), Andrei Kozlovski (age 42), Igor Ladanov (age 28) and Artem Yuryev (age 31).

Attorney Commentary

In New York, there is no fault accident insurance. Health care fraud prosecutions are now proceeding beyond Medicare and Medicaid and are targeting private insurance companies. What appears to be alleged in this case is that the DME companies alleged that the price to the wholesale companies was more than charged, that the DME companies issued false invoices, the insurance companies sent checks to the wholesale companies, and then the wholesale companies cashed the checks at check-cashing stores. At that point, it is alleged that the cash funds were delivered back to the individuals charged.

How does the government prove such a case? Usually through  subpoenaed bank records and a forensic accounting probe. This means that witnesses are not necessary and it becomes a paper case. In order to evaluate the liability or exposure on such a case, analysis of these records by defense counsel is necessary.

The mark-up allegations are aggressive and are usually charged as a means of showing how kickback or other fraudulent schemes exist.  Large mark-up is not in and of itself against the law but is a factor that is considered on whether there is health care fraud. In some occasions, the large mark-up is used to explain how the extra money made is used for kickbacks or referral fees. 

Posted by Tracy Green, Esq. Any questions or comments should be directed to Tracy Green, a very experienced California health care fraud attorney, DME fraud attorney, California insurance fraud attorney, and California white collar criminal defense attorney at tgreen@greenassoc.com.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers and in health care fraud related matters in California and throughout the country. Their website is: http://www.greenassoc.com/

Thursday, January 14, 2010

L.A. County District Attorney’s Office Is To Receive $17.2 Million In 3 Grants From Dept. Of Insurance To Combat Workers' Comp & Auto Fraud


A spokesperson for Supervisor Michael D. Antonovich said that the Board had unanimously approved the grants, totaling $17.2 million, to combat automobile insurance and workers’ compensation fraud.

According to the spokesperson, a $5.3 million grant will be given to the District Attorney’s office “to combat fraudulent claims that cost taxpayers millions of dollars annually and have led to thousands of jobs being lost due to local business closures precipitated by escalating workers’ compensation costs caused by fraud.”

The remaining two grants will focus on auto insurance fraud organizations and using the spokeperson's own words the “unscrupulous doctors, chiropractors, lawyers and others who profit from fraudulent automobile insurance claims.”

Attorney Commentary: The funding of these special units explains why there is an increased prosecution in these cases. The reason is that this is not County money but grants for specified funding and the grants require the monies be used for the specified purposes. We can therefore expect to see more investigations and prosecutions involving professionals in the personal injury and workers' compensation fields.

It is not specified but usually these grants are from the Department of Insurance who obtain the funds by assessment on insurance policies. Representatives of the insurance companies are often on the committees who decide which counties receive these grants and whether they will be awarded grants the following year.

In other words, representatives of the victims of these insurance crimes have a say in the prosecution of these cases and are able to fund the prosecutions. It is different than the way almost all other crimes are prosecuted.

Any questions or comments regarding this post or your own situation should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California and focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Wednesday, January 13, 2010

Criminal Prosecution For Auto Insurance Fraud Continued To Rise: 2 Recent Cases


Up until a few years ago, if someone had filed a false auto insurance claim claiming their car had been hit in an accident – all that usually would have happened is for the insurance claim to be denied. The matter was handled as a civil dispute between the auto owner and his or her insurance carrier except in extreme cases. Those days are over. In these post-Madoff days, any type of fraud is being investigated and prosecuted. Moreover it is being punished more harshly. As an insurance fraud attorney, I review recent cases to see the trends in prosecution and sentencing.


Two cases from Ventura County illustrate what can happen when people make false insurance claims when they are either under financial stress or find themselves uninsured. Like most criminal cases, only a small percentage of insurance fraud is discovered – but when it is discovered, it is being punished harshly to deter others. In both cases, the individuals charged were first-time offenders and ordered to serve jail time for both a misdemeanor and a felony plea (30 to 60 days).

1st Case – Falsely Reporting That Accident Occurred On A Different Date To Obtain Insurance

On December 9, 2009, Lauro Aguilar-Martinez of Glendale, California was sentenced after pleading guilty to misdemeanor auto insurance fraud. The facts alleged were as follows. On June 13, 2009, Mr. Aguilar-Martinez rear-ended a vehicle on Interstate Highway 5 in Los Angeles. At the time, Mr. Aguilar-Martinez was not insured.

He decided to become insured. Thus, on June 19, 2009, he purchased auto insurance from Alliance United Insurance Company in Ventura. On June 23, 2009, Aguilar-Martinez contacted the Alliance United claims department and made a claim for the June 13 rear-end collision. However, he falsely reported that the collision occurred on June 23, 2009, after he was insured.
Mr. Aguilar-Martinez was placed on probation for three years and ordered to serve 30 days in the Ventura County jail.
The new aggressiveness in prosecution is also evidenced by the fact that in the first case, the accident at issue occurred in Los Angeles but the Los Angeles County resident purchased auto insurance from a company in Ventura County while allowed Venture to prosecute the case.

2nd Case – False Report of Stolen Truck
Last month, on December 9, 2009, Hidalgo Lopez Gomez of Oxnard was sentenced to serve 60 days in the Ventura County jail after having pleaded guilty to felony auto insurance fraud. Mr. Gomez was placed on formal probation for three years and was ordered to pay Infinity Insurance $3,547 in restitution prior to his sentencing.
The facts in this case are as follows. On January 29, 2009, at 5:00 a.m., Mr. Lopez contacted the Oxnard Police Department and reported his 2008 Dodge truck was stolen after he went inside a market on Saviers Road. Mr. Lopez claimed he left his truck running as he went inside the market to buy coffee. When he returned outside, his truck was gone. Later that same day, Mr. Lopez contacted Infinity Insurance and made a claim for the theft.

Mr. Lopez's claim was assigned to Infinity's Special Investigations Unit (SIU). An SIU investigator made an inquiry with the Department of Homeland Security and learned the license plate readers at the San Ysidro border crossing recorded Lopez's truck traveling into
Mexico at 3:37 a.m. on January 29, 2009. There was no record of the truck returning to the United States.

Since Mr. Lopez's account of how and when his vehicle was “stolen” did not add up, Infinity Insurance referred the case to the California Department of Insurance, Fraud Division. After additional investigation by fraud detectives, Mr. Lopez was subsequently arrested and charged with felony auto insurance fraud.

Any questions or comments regarding this post or your own situation should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California and focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Monday, November 30, 2009

Oxnard Man Pleads Guilty To Auto Insurance Fraud From 2007 Accident


Another case has arisen where a person's financial concerns about repairing their vehicle caused them to submit a false insurance report which resulted in criminal prosecution. On November 13, 2009, Ronald Lewis Dixon, of Oxnard, pleaded guilty in Ventura County Superior Court to one count of felony auto insurance fraud arising out of a 2007 auto accident.

The facts underlying the plea are as follows. On November 25, 2007, at 1:20 a.m., an Oxnard Police officer was dispatched to a traffic collision at the intersection of Ventura Boulevard and Alvarado Street. The officer found a 2006 Nissan truck crashed into a retaining wall. The truck was abandoned but locked. The officer noticed there was no evidence of forced entry or damage to the ignition lock. The officer checked the license plate and learned the vehicle was registered to Mr. Dixon , who lived less than half a block from the collision scene.

The officer went to Mr. Dixon 's residence. When Mr. Dixon opened the door, the officer noted that Mr. Dixon was dressed as if he just returned from a night out and his breath smelled of alcohol. Mr. Dixon would not admit he was driving his truck, fearing he would be arrested for DUI.

Two days later Mr. Dixon contacted his insurance company, Infinity Insurance, and reported someone stole his truck and crashed it. The following day, Mr. Dixon went to the Oxnard Police Department and tried to file a stolen vehicle report. After giving his account of how his truck was “stolen, but later found,” the Oxnard Police Department refused to take the report.

Infinity Insurance referred the case to the California Department of Insurance, Fraud Division. Fraud detectives eventually arrested Dixon for insurance fraud. Once arrested, Mr. Dixon admitted he crashed his truck and lied because he thought the insurance company would not repair his truck if it discovered he had been drinking prior to the accident.

Mr. Dixon will be sentenced on January 5, 2010, at 1:30 p.m., in courtroom 13 of the Ventura County Superior Court. He faces a maximum penalty of five years in state prison and a $50,000 fine. When Mr. Dixon pleaded guilty he turned over a cashier's check for $3,749 (the amount of restitution due to the victim in the case, Infinity Insurance).

Posted by Tracy Green. Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates in Los Angeles, California. They focus their practice on the representation of professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have developed an expertise in insurance fraud cases over the past 20 years. The firm website is http://www.greenassoc.com/

Monday, November 9, 2009

Chiropractors And Attorneys Charged In Staged Accident And Auto Insurance Fraud Case In Los Angeles County


On October 27, 2009, four chiropractors were among those arrested and charged with grand theft and insurance fraud by the Los Angeles County District Attorney's Office (Automobile Insurance Fraud Division) in LASC Case No. BA363494. A few days earlier, four attorneys were similarly charged in the same case. A total of 28 defendants were charged in this case.

Chiropractors Mark A. Stolyar, Babak Naghi, Dmitriy Sklyut, and Christopher Manuel Cleveland were charged. Attorneys Leon Rubin Laufer, John Akopian, Edward Leonid Katsnelson and Stephen Marshall Weiss are charged with numerous counts of insurance fraud, grand theft of personal property and false and fraudulent claim. Mr. Akopian was also charged with money laundering, receiving stolen property and possession of an assault weapon.

A criminal complaint is only an accusation is not evidence of guilt. All the defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

The attorneys and chiropractors charged are accused of defrauding 15 insurance companies by allegedly filing false claims for staged accidents. Prosecutors allege that the defendants are part of a larger conspiracy involving more than 300 suspects.

There was allegedly a network of of attorneys, chiropractors, doctors, marketers or cappers, and body shop owners who are believed to have worked to defraud auto insurance companies. In addition, the drivers or insureds were involved as well in the fraud. In many of these cases, it is alleged that the accidents only happened on paper. In some of these cases it is alleged that conspiring body shops inflicted physical damages to vehicles reportedly involved in staged accidents.

These charges relate to hundreds of staged auto accident cases and is related to another Los Angeles County case , LASC No. BA340194, in which Alexander Igor Gutman and Laszlo Aldar Bango were charged last year. These defendants plead guilty in February 2009, are cooperating and are awaiting sentencing. Mr. Gutman allegedly was involved in staging some 2,600 “paper accidents” and Mr. Bango was purportedly his co-conspirator. The investigation leading up to Mr. Gutman's case was known as "Operation Big Fish."

Attorney Commentary: There are numerous related issues in these types of cases in order to prove whether or not the attorneys and chiropractors knew that the accidents were staged. It is my experience that the professionals are not told that the cases are staged.

Often circumstantial evidence will be used to show knowledge of intent to defraud. For example, in many of these cases there may have been "marketing" fees or kickbacks for the referral of patients or clients. These referral or marketing fees may be used to show that the attorneys or chiropractors knew or should have known that the accidents were staged. One reason I tell clients that marketing is dangerous in personal injury cases is that once marketers run out of real cases they will create cases to keep their income flow.

Another way the prosecutors may prove fraud is to show that the chiropractors did not have the patients receive all the treatment that was billed to the insurance company. For example, did the patients sign in for treatment that was not received and did the chiropractor bill for it? This allows the prosecutors to prove a false billing claim which is easier to prove than knowledge of a staged accident. However, it could also be used as circumstantial evidence that the chiropractors knew that there was no real injury. The billing statement is provided to the attorneys who then submit it to the insurance carriers in support of their settlement demand.

The sheer number of claims can also be used to show that the attorney or chiropractor must have known that the accidents were staged or exaggerated. Looking at these cases in hindsight with the cooperating testimony of Mr. Gutman and the patients/clients can be difficult to face at trial.

One of the other issues will be whether the attorneys or chiropractors had office managers who had significant authority in their office including, but not limited to, client or patient marketing. The role of other office personnel and whether they are cooperating or not will have significant impact on this case.
In some of these cases, I have seen attorneys use as a defense the fact that when they are told by the insurane carriers that the case is fraudulent that they drop it. However, this is not always a great defense since the prosecutors use it to show that the cases are only dropped once the fraud is discovered. Moreover, often there is no investigation to find out how this fraud case came into the office and no questioning of the referring person or client.

Prevention and compliance is very important in a personal injury or workers compensation practice for attorneys and treating physicians. A compliance plan and audit is important to avoid these type of allegations and charges. Referral and marketing fees cause much of the fraud in my experience.

In addition, during economically depressed times or among low-income populations, there are clients/patients who will lie to insurance companies and their doctors and attorneys in order to make a couple of thousand dollars. However, at the end of it all, the prosecuting agencies will want the persons with licenses charged and will put as a lower priority the patients and clients who agreed to the fraud. The prosecutors will reason that if they can prevent the professionals from facilitating the fraud -- it will be much more difficult to perpetrate.

Any questions or comments should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California. Ms. Green focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Wednesday, October 7, 2009

Two Recent Auto Fraud Prosecutions In Ventura And San Bernardino Counties For Filing False Stolen Vehicle Claims With Insurance Companies


Here are two recent automobile insurance fraud cases from Ventura and San Bernardino Counties. There has been a significant increase in the prosecution of these cases. In addition, the time for investigation and prosecution of these types of cases has shortened. For example, in the Ventura County case, there was an arrest and sentence within two months of the alleged false stolen vehicle report.

Venutura County

On September 24, 2009, Jose Jesus Quiroz of Oxnard was sentenced to felony probation for a period of three years and ordered to serve 90 days in the Ventura County jail. He was also ordered to pay restitution to Infinity Insurance in the amount of $4,293. This sentence follows his guilty plea to felony auto insurance fraud.

The alleged facts in this case are as follows. On the morning of August 10, 2009, Mr. Quiroz called the Oxnard Police Department to report that his 2002 GMC Denali was stolen. Mr. Quiroz told the police he parked and locked his vehicle in front of his house the previous day, August 9, but when he came outside the following morning, the vehicle was gone. He then reported the “theft” to his insurance carrier, Infinity Insurance.

Infinity was notified by the National Insurance Crime Bureau that Mr. Quiroz's car was impounded in Mexico on August 8, 2009. When questioned by Infinity Insurance, Mr. Quiroz said he had his vehicle on August 9, 2009, and denied taking it to Mexico. Infinity then referred the case to the California Department of Insurance Fraud Division (CDI) for investigation.

Mr. Quiroz eventually confessed to CDI investigators that he had financial problems and could no longer afford his monthly car payments. A friend allegedly told him that he could “leave” his truck with people in Mexico who would get rid of it for him. Mr. Quiroz then admitted reporting the vehicle as stolen in an attempt to collect insurance money.

San Bernardino

On September 14, 2009, Gustavo Garcia of Fontana was arrested at his place of employment and charged with (1) perjury (Penal Code Section 118), (2) insurance fraud (Penal Code Section 550 (A) (1) PC) and (3) Penal Code Section 550 (B)(1).

A felony complaint is only an accusation is not evidence of guilt. Mr. Garcia as a defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

It is alleged that Mr. Garcia claimed someone stole his 2005 GMC Yukon from his driveway in Fontana on June 29, 2008. It was recovered on July 12, 2008, in Ontario. He allegedly claimed prior to the theft that he had a company install over $9,000 in after market electronic accessories in his vehicle, as well as new tires and rims. He produced a receipt to State Farm that stated all of the items he purchased were installed in his vehicle. Experts hired by State Farm examined his vehicle and said the items were never installed. The owner of the company that Garcia said installed the tires, rims and other electronic items stated he never put them in the vehicle and never received any money from Garcia. Bail was set at $100,000.

It is also alleged that Mr. Garcia filed a similar claim in September 2007. He reported his 2005 GMC Yukon stolen to State Farm. He had submitted a receipt to State Farm, from a company that he said installed new tires, rims and the same electronics he claimed in the theft nine months later. State Farm paid the first claim, but when Garcia made the same claim again, they began looking into both claims. State Farm denied the second claim due to the lack of cooperation by Garcia.

Attorney Commentary: First, the Ventura County case involved the person suspected of the offense speaking with investigators and ultimately confessing. This confession was most likely made without any immunity or agreement of leniency. If you are interviewed by an insurance company's Special Investigations Unity (SIU) or are asked to submit a declaration under oath, you would be well-advised to seek legal counsel. If you have legal exposure, you want to analyze whether you should make further statements in support of a problem claim.

Remember that anything you say or write is evidence that can be used to prosecute you. Do not think that by being helpful or confessing that there will not be a criminal filing. Even if the investigators tell you that if you admit the truth they will go easier on you, remember that this is not a promise binding on the government prosecutors. Also, do not make the mistake of thinking that if you hire an attorney you will "look guilty." It is better to have an attorney give you sound advise rather than to make statements or sign documents that will later be used against you.

Second, remember that the insurance companies have a database of prior claims. If there is a pattern or similar claim, that can trigger an investigation. Merely having a number of auto accidents or claims within a year can trigger an investigation. The insurance companies and government agencies share information.

Posted by Tracy Green. Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates in Los Angeles, California. They focus their practice on the representation of professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have developed an expertise in defending insurance fraud cases over the past 20 years. The firm website is http://www.greenassoc.com/

Friday, August 28, 2009

Two Recent Auto Insurance Fraud Cases For Reporting Vehicles As Stolen From Ventura County


There are two recent auto insurance fraud cases prosecuted by the Ventura County District Attorney's Office. Both cases involve falsely reporting a stolen vehicle and illustrate how one bad decision can snowball out of control and lead to criminal prosecution. As the economy worsens, these type of cases increase.

In addition, Ventura County is known for being hard on crime and the first case where there's been a sentencing involved jail time of 218 days where the loss amount was less than $3,000. The second case involves potential jail time. Thus, venue (where the case is being prosecuted) matters.

Auto Insurance Fraud - 1st Case of Falsely Reporting Stolen Vehicle

On August 19, 2009, Paul Lafflito of Simi Valley was sentenced after previously pleading guilty to felony evading a peace officer and felony auto insurance fraud. Mr. Lafflitio was placed on formal probation for three years and ordered to serve 218 days in the Ventura County jail. He was ordered to pay restitution of $1,278 to Alliance United Insurance Company and an additional $1,592 to the property owners where he crashed his truck.

The allegations in the case were as follows. On March 25, 2009, at 9:00 p.m., two Simi Valley Police Department officers were working undercover in an unmarked patrol vehicle. They were stopped for a red light at the intersection of Sycamore and Royal when they saw a silver Dodge Ram pick-up truck approach the intersection. The Dodge failed to stop for the red light. As the Dodge drove through the intersection, one of the officers shined his spotlight into the cab of the Dodge and got a good look at the driver, Mr. Lafflitio.

The officers tried to pull over the Dodge but the truck sped away. Mr. Lafflitio drove at times between 90 and 100 mph while fleeing from the officers. Because he was driving so fast and recklessly, the officers decided to terminate the pursuit. Minutes later, however, the officers discovered Lafflitio's truck crashed and abandoned on private property off Wood Ranch Parkway. The officers discovered Mr. Lafflitio was the registered owner of the truck and called him. Mr. Lafflitio answered his cell phone and told the officers that he was “night-clubbing” in Hollywood. He added the vehicle must have been stolen from where he last parked it in Simi Valley. He said he would come to the police department the following day to report it stolen.

Unbeknownst to Mr. Lafflitio, both officers got a good look at him driving as the pursuit began. Additionally, cell phone tracking evidence placed Mr. Lafflitio in Simi Valley at the time of the pursuit, not in Hollywood as he told the officers. When Mr. Lafflitio arrived at the Simi Valley Police Department the next day, he was identified and arrested. The officers subsequently learned that prior to arriving at the police department, Mr. Lafflitio called Alliance United Insurance Company and falsely reported his vehicle was stolen.

Auto Insurance Fraud - 2nd Case Of Falsely Reporting Stolen Vehicle

On July 29, 2009, Rodolfo Donjuan of Camarillo pleaded guilty to one count of felony auto insurance fraud. This case was investigated by the California Department of Insurance Fraud Division.

Mr. Donjuan contacted the Ventura County Sheriff's Department on July 18, 2008, and reported his 2000 Chevrolet Silverado had been stolen from a friend's house in Camarillo . The Silverado was subsequently located abandoned and wrecked a short distance away. Mr. Donjuan also filed a claim with his insurance carrier, Infinity Insurance.

During the next two months, Mr. Donjuan gave Infinity Insurance conflicting statements about the theft of his vehicle. His insurance claim was transferred to Infinity's Special Investigations Unit.

On September 24, 2008, Mr. Donjuan was deposed under oath by an Infinity Insurance attorney. During the deposition, Mr. Donjuan was confronted with his inconsistent statements and admitted that he had lied. Mr. Donjuan stated he had been drinking beer and was driving when he crashed his vehicle. Mr. Donjuan said he ran away from the scene because he was afraid.

Mr. Donjuan will be sentenced on August 25, 2009. The maximum penalty for this charge is five years in state prison and a fine of up to $50,000. His sentence will depend on a number of factors and could range from probation to state prison depending upon his prior record and whether he has paid restitution to the insurance company.

Any questions or comments should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California. Ms. Green focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Tuesday, July 28, 2009

San Bernardino Woman Charged With Insurance Fraud And Perjury Based On Alleged Exaggerated Injuries And False Deposition Testimony In Civil Lawsuit


On July 20, 2009, in San Bernardino County Superior Court, a criminal complaint was filed charging Esther De Leon of Rialto, California with four counts of insurance fraud in violation of Penal Code Sections 550 (A) (1) and 550 (B) (1) PC and two counts of perjury in violation of Penal Code Section 118. Her bail was set at $50,000.

A felony criminal complaint contains allegations that a defendant has committed a crime. Every defendant including Ms. De Leon is presumed innocent until and unless proven guilty.

This case is somewhat unusual in that it arose out of an automobile accident that actually occurred and where there was a subsequent civil personal injury lawsuit. The criminal charges arose from the statements that were made under oath by Ms. De Leon in a deposition the civil lawsuit.

The underlying alleged facts are as follows. On November 7, 2007, De Leon was driving a Chevy Avalanche and stopped in heavy traffic in Fontana. Her car was struck in the rear by a San Bernardino County vehicle going a few miles an hour. There was minor damage to the Chevy and at the time of the accident, Ms. De Leon refused any medical attention. Soon after the accident, Ms. De Leon began to see several doctors claiming the traffic accident caused numerous major medical problems. She obtained an attorney and they sued the County of San Bernardino. A doctor hired by the county examined her and could find nothing wrong with her. The county also hired a private investigator who followed her and taped her daily activities.

In the civil lawsuit, she had her deposition taken and testified under oath that she could not go to work, go out of her house, pick up her grandchild, or even comb her hair because one of her medical complaints was, her right arm was numb. The investigators found her working at a dry cleaner's and lifting heavy objects without any noticeable problems.

Attorney Commentary: For years in civil personal injury lawsuits, exaggerated injuries have not been uncommon but are usually not prosecuted. In fact, in some personal injury cases, minor injuries would be overtreated and medical and therapy bills would help build up the value of the cases.

This case illustrates several trends. First, this case probably obtained the attention of law enforcement because the civil defendant was San Bernardino County and not an individual or private company.

Second, insurance companies and government agencies are being aggressive about insurance fraud and the special units in the County District Attorney's Offices are not hesitant about filing these cases.

Third, although we do not know Ms. De Leon or how her testimony arose, it is not uncommon for unsophisticated and uneducated people to assume that if they are not completely disabled or injured that they will not recover any money for their actual injuries. The fact that Ms. De Leon refused medical attention at the accident site is not proof of fraud since soft tissue injuries can take time to develop. But we have seen sophisticated, educated people exaggerate simply because they do not realize that telling the truth in a detailed manner will help their case and that exaggerations will simply weaken their credibility and their case. We have seen much more perjury in civil lawsuits that in criminal cases.

Fourth, this may be an interesting trend for our society as a whole. With the large fraud cases such as the Bernie Madoff case, the real estate mortgage debacle, and a society which seemed to sanction cheating as long as someone made money at it -- the tide has shifted. Defenses such as "everyone else is doing it" are not persuasive and if a person has the bad luck of being the one person prosecuted for what everyone else is doing, that person will be used as an example and will be prosecuted to deter others.

Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates in Los Angeles, California. They focus their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing individuals and companies in fraud investigations and federal and state cases. Their website is: http://www.greenassoc.com/

Tuesday, June 9, 2009

Vehicle Insurance Fraud Cases Increase - What To Do If You Are Under Investigation


In April of 2009, we wrote about the increase in vehicle insurance fraud due to the economic downturn.
See
http://greenandassociates.blogspot.com/2009/04/auto-insurance-fraud-attorney.html

This week's Los Angeles Times has an article on this same issue entitled "Vehicle Fraud Cases Heat Up Amid Economic Downturn." See:
http://www.latimes.com/business/la-fi-auto-torch8-2009jun08,0,1869536.story

Here is a recent criminal case that illustrates the type of mistakes that desperate people are making when they are under financial stress and want to cut down on their automotive costs.

On May 28, 2009, San Bernardino County District Attorney investigators arrested Ted Chavez Jr., of Fontana, for perjury, insurance fraud and disposing of insured property. The criminal complaint alleges that in October 2007, Chavez claimed that he drove his 2007 Chevy Avalanche to a swap meet in Fontana. He alleged that he parked and locked his vehicle before going shopping. Chavez claimed that when he came back to his vehicle a couple hours later, the Chevy was gone. He filed an auto theft report with the Fontana Police Department and a theft claim with Infinity insurance company.

During a check of vehicles passing through the border, it was discovered that Chavez' Avalanche crossed into Mexico at the San Ysidro crossing about 12 hours before he claimed to have driven it to the swap meet. The District Attorney's Office filed several felony charges against Chavez. Chavez's bail was set at $105,000. A criminal complaint contains only allegations against an individual and Chavez must be presumed innocent unless and until proven guilty.

Attorney Commentary: First, as noted in our prior post, the special units at the county district attorney's office are funded by a surcharge on vehicle insurance premiums which was created by legislation. Thus, there is funding to prosecute these cases and even relatively "small" cases will often result in charges.

Second, the insurance companies have their own special investigation units (SIU) with investigators and attorneys which conduct their own investigations. They conduct their own investigation and put together a package which is then referred for criminal prosecution. If an insured vehicle owner has made some bad decisions, the time to turn around the investigation if possible is while the case is still at the insurance company or its SIU unit.

Third, if you are dealing with interviews with the insurance company and it is a suspicious claim, it is time to hire an attorney. For example, if you submit an insurance claim and the company suspects fraud, you will receive a letter or request for an “Examination Under Oath” or EUO under the penalty of perjury. An EUO is similar to a deposition since there is a court reporter present taking down your statements. This can be used for future criminal prosecution.

If you receive a letter for an EUO, it is time to hire an attorney experienced in insurance fraud to represent you. The earlier you seek to engage in damage control, the better. These cases are not usually going to get better, but will get worse especially if you are making inconsistent statements or providing information that is inconsistent with the actual physical evidence.
The best time to prevent a case from being filed is early on. If you can save being charged with insurance fraud, it will be a worthwhile investment. Once a case is filed, it is much more difficult to obtain dismissals or acquittals -- especially if you have given already given a damaging EUO to the insurance company.

Any questions or comments should be directed to: tgreen@greenassoc.com 
Tracy Green is a principal at Green and Associates, Attorneys at Law, in Los Angeles, California. They focus their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. The firm's attorneys have represented numerous individuals and businesses in insurance fraud investigations and criminal filings.

Wednesday, May 6, 2009

Bureau Automotive Repair Investigation Results In Insurance Fraud Charges Against Auto Repair Shop


On April 28, 2009, Harold Galvez the owner of G and H Auto Repair was charged with insurance fraud by the San Bernardino County District Attorney’s Office. The Bureau of Automotive Repair (B.A.R.) began an investigation in December 2008 when Galvez' auto body business was performing auto insurance repair work without a State Auto Dealer Repair license.

The B.A.R. was tipped off when a consumer contacted that agency and requested that their vehicle be inspected after being repaired at Galvez' business. The consumer felt the repairs to their vehicle were suspicious and possibly fraudulent in nature. Investigators from the B.A.R. determined Galvez had charged the insurance company for new factory parts, but instead used cheaper aftermarket parts for the repairs. Galvez pocketed the excess funds of over $3,400, which he had received from AAA for the new parts. B.A.R submitted the investigation to the DA’s Auto Insurance Fraud Unit. Mr. Galvez was arrested at his business and bail was set at $50,000.

Attorney Comments: Remember, in California any fraud over $400 is a felony. Insurance fraud is prosecuted more aggressively than other fraud since insurance companies have their own investigators and turn over complete prosecution packages to the D.A.'s Offices. If there is any type of insurance investigation, it needs to be handled carefully. Moreover, businesses that bill insurance should have compliance plans in place to have a safe harbor against fraud charges. Billing mistakes and errors can happen -- but it will be necessary to prove there was no fraudulent intent. An effective compliance plan can help prove lack of intent to defraud.

Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates in Los Angeles, California. They focus their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings.

Saturday, April 4, 2009

Auto Insurance Fraud: Attorney Commentary On Increased Number Of Cases And Effect Of Economic Pressure


The economy is pushing some people over the edge. We are seeing that as times get tougher people of all economic backgrounds are engaging in acts they normally wouldn't commit. For example, there is an increase in people abandoning, torching or damaging their own vehicles to collect insurance or to avoid payments. In other cases, people are submitting claims for auto accidents in which did not occur. This type of conduct is a crime and most false claims can be prosecuted as a felony. Further, insurance claim forms are often signed under the penalty of perjury.

In California, there is funding at the county District Attorney's Offices for these cases -- which makes prosecution more likely. Under the direction of the Insurance Commissioner, the California Department of Insurance makes funds available, as authorized by Section 18971 of the California Insurance Code, to the District Attorney’s Office for investigation and prosecution of automobile insurance fraud. The DA's Offices apply for grants and they are able to use these funds to pay for experienced prosecutors.

Here are four recent cases from the past month involving these types of false insurance claims. Remember that complaints contain only allegations against an individual and all defendants must be presumed innocent unless and until proven guilty.

■ On April 1, 2009, Anthony Razo, a former Los Angeles police officer was accused of torching his 2005 BMW 745 Li, then reporting it stolen and filing insurance claim for the loss in January 2009. Mr. Razo was charged by the Los Angeles County District Attorney’s Office in Case No. BA 354733 with five felony counts and two misdemeanors. The felony counts of insurance fraud, defrauding an insurer and arson on one’s own property pertained to the BMW.

■ On April 1, 2009, Teresa Turbyfill was charged with auto insurance fraud by the San Bernardino County District Attorney's Office. According to the complaint, in November 2008, Turbyfill's husband left the scene of a collision after a hit and run accident in his 2005 Cadillac. He subsequently reported to the Morongo Sheriff's Office that he had been carjacked prior to the hit and run, and that his 2005 Cadillac had later been burned by the suspects and
destroyed in the fire. Teresa Turbyfill allegedly filed an insurance claim listing the vehicle as a total loss due to the arson. The complaint alleges that she did this even after having complete knowledge of her husband's alleged actions.

■ On or about March 27, 2009, Nick Alan Thompson was charged by the San Bernardino County District Attorney’s Office after an auto insurance fraud investigation. The complaint alleges that the owner of a 2007 Suzuki GSX600 motorcycle reported it as stolen for the purpose of insurance fraud. The motorcycle was allegedly given to Thompson so he could dispose of the motorcycle. The motorcycle was found in Thompson’s garage. Thompson was charged, booked and bail was set at $50,000.

■ On February 23, 2009, the San Bernardino County District Attorney’s Office filed felony insurance fraud charges against Paul Fiedler of Pomona. The complaint alleges that in October 2007, Fiedler was involved in a minor traffic accident in the City of Ontario. The police were not called and both parties exchanged information. At the time of the accident, Fiedler had a $1,000 deductible for collision repair to his vehicle on his Geico auto insurance policy. On the day of the accident, he went online to the Geico Insurance website and made a policy adjustment on his $1,000 deductible for collision and changed it to a $150 deductible for collision.

The next day, he again went on the Geico Insurance website and filed an online accident claim, indicating that the accident had occurred on October 26, instead of October 25. He also contacted the other driver, in an attempt to convince him to give a false statement to Geico regarding the date of the accident. The other driver refused to take part in changing the date of the accident and so advised Geico. Fiedler was arrested at his place of business, where he worked as a loss prevention officer. He was booked into custody and bail was set at $25,000.

Attorney Commentary: For those who have filed false claims, the best time to craft a defense is prior to the filing of charges. There are many tactics and strategies that can be done to help unwind bad decisions. Although only a small percentage of false claims are prosecuted, there is no way to know which ones will be prosecuted. We see cases involving smaller dollar amounts being prosecuted. This is especially true with insurance claims since the carriers and NICB will do most of the work in investigating and putting together the prosecution package and evidence for law enforcement.

If you have filed a false claim, have been served with a search warrant or know the claim has been assigned to the Special Investigation Unit (SIU) of the carrier, you should contact an attorney as soon as possible. The best advice is for you not to speak with any investigator (police or insurance) until you have retained counsel and created a strategy on how to handle the matter. Waiting until you are arrested is not the best time to create a strategy.

We see investigators taking arrested defendants to their office and interview them in order to obtain quick confessions. People think that this will help them when all it usually does is create a better case for the prosecution. There are times when cooperation makes sense but it is not after arrest when there is no type of immunity or cooperation agreement in place.


Posted by Tracy Green, Esq.  Any questions should be directed to Tracy Green, a very experienced Los Angeles insurance fraud attorney and Los Angeles fraud attorney. You can email her at tgreen@greenassoc.com or call her at 213-233-2261.

The firm focuses its practice on the representation of licensed professionals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing professionals in criminal matters, including automobile insurance fraud, insurance fraud and other financial crimes in California and throughout the country. Their website is: http://www.greenassoc.com/


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