Zalma’s Insurance Fraud Letter April 1, 2022

Mr. Biden & Mr. Putin: Exegetically Speaking Know Thy Self

Read the full article at https://www.linkedin.com/pulse/zalmas-insurance-fraud-letter-april-1-2022-barry-zalma-esq-cfe and see the video Explanation at https://rumble.com/vz6m5h-zalmas-insurance-fraud-letter-april-1-2022.html?mref=6zof&mrefc=2 and at

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Zalma’s April 1, 2022, with no April Fools Jokes, provides information needed by every insurance claims and insurance fraud professional, all available FREE on line.

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Quote of the Issue

“We Cannot Solve Our Problems with The Same Thinking We Used When We Created Them.”

Albert Einstein  

Russian Immigrant Who was Convicted of Fraud Must Leave the U.S.

COMMIT INSURANCE FRAUD GO DIRECTLY TO JAIL AND THE BACK TO RUSSIA

Alexie Legassov, a convicted insurance fraud perpetrator, petitioned the USCA for review of a final order of removal and the denial of a motion to remand. In Alexei Legassov v. Attorney General United States of America, No. 21-2586, United States Court of Appeals, Third Circuit (February 24, 2022) the USCA decided it was time he returned to mother Russia.

FACTS

Legassov, a Russian citizen, has lived in the United States since 1993. In 2018, he was convicted in New Jersey of insurance fraud and operating a corporation for criminal purposes. He was sentenced to prison terms of four and five years, respectively, and ordered to pay over $1.2 million in restitution. After the Government initiated removal proceedings in 2019, an Immigration Judge (IJ) concluded that Legassov was removable as a noncitizen convicted of two or more offenses for which the aggregated sentences were five years or more and as a noncitizen convicted of a crime involving moral.

In August 2020, Legassov, proceeding pro se, applied for asylum, withholding of removal, and protection under the Convention Against Torture (CAT). At a hearing in January 2021, Legassov testified that he entered the United States due to fears relating to his father’s involvement in investigating the 1986 Chernobyl disaster. Although the official cause of his father’s death in 1988 was suicide, Legassov claimed that the Russian government had his father killed and he was warned to stop discussing that topic. Legassov stated that he was not harmed while in Russia, but he believed that the KGB initiated charges against him in 1996 after his departure and that he had been included on a wanted list.

The IJ ruled on several grounds that Legassov did not qualify for relief. In addition to making an adverse credibility finding, the IJ concluded that the one-year filing deadline barred the asylum application, and Legassov failed to provide a significantly changed circumstance to extend the time for filing. Even aside from the one-year bar, the IJ explained that he would deny asylum as a matter of discretion due to Legassov’s criminal history. The IJ likewise decided that Legassov had committed a “particularly serious crime” which rendered him ineligible for withholding of removal, and that Legassov did not qualify for CAT relief where he had not shown it would be more likely than not that he would be tortured upon his return to Russia. The IJ also denied voluntary departure.

On appeal, the BIA agreed with the IJ’s reasoning, rejected all grounds advanced in Legassov’s counseled brief, and dismissed the appeal. The BIA also denied a motion to remand because the evidence submitted did not rebut any of the IJ’s findings.

ANALYSIS

Notably, Legassov has not disputed that he is removable on the statutory grounds cited by the agency based on his criminal history (for committing a CIMT and for convictions of offenses carrying aggregated sentences of five or more years’ imprisonment). Also, he did not previously challenge the IJ’s conclusions that he was ineligible for asylum, withholding of removal, or CAT relief on appeal in the BIA; although he now claims, in very general terms, that he was eligible.

What remains are jurisdictional and due process arguments Legassov raised before, and the court rejected them for largely the same reasons the BIA did.

Legassov argues in his petition that the immigration court violated his due process rights by failing to adequately explain the proceedings or to develop the record. However, the record reveals no due process violation in Legassov’s proceedings.

the IJ explained to Legassov how he might retain an attorney and, after granting one continuance, the IJ was poised to grant another for Legassov to find an attorney. However, Legassov demurred and asked if the proceedings could move forward, and the IJ obliged. The IJ explained that Legassov would testify in support of his asylum application at the next hearing, and the IJ gave him time to submit documentation; Legassov did both. Legassov does not detail what else the IJ should have explained. Further, he has not shown that any deficiency prejudiced him, which is fatal to a due process claim.

Legassov did not show the requisite prejudice. In addition to the State Department report on country conditions in Russia in the record, the IJ considered statements of Legassov’s relatives and an article concerning the Russian opposition leader Alexei Navalny. Legassov does not state what other evidence that the IJ should have helped him obtain or how he was prejudiced by the absence of that material.

Finally, Legassov requested a remand so that his CAT claim could be considered in light of “new” evidence, including his birth certificate, articles about the Chernobyl disaster and his father, and articles about Russian intelligence activities. However, as the BIA explained, this evidence did not meaningfully address the shortcomings of his claims. Therefore, the BIA appropriately denied remand.

The BIA may deny a remand motion where the movant has not established prima facie eligibility for relief, fails to introduce previously unavailable, material evidence, or would not be entitled to discretionary relief even if the motion were granted.

Accordingly, the petition for review was denied.

ZIFL OPINION

In 1993 the United States allowed a Russian Criminal, Legassov, who was wanted by the then KGB, to enter the United States and enter into multiple state and federal crimes until he was finally caught, prosecuted and convicted and sentence to five years in a federal prison and an order to remove him from the U.S. back to Russia. He used the judicial system including appeals to the Third Circuit. He should never have been allowed in the U.S. and remaining in the U.S. violates the law as did his insurance fraud. He should be put on a plane and sent to the mercy of Vladamir Putin. Perhaps he will be conscripted into the Russian military.

Wisdom

“My mind rebels at stagnation... I abhor the dull routine of existence. I crave for mental exaltation.” – Sir Arthur Conan Doyle

“Truth is heavy, so few men carry it.” —  Jewish saying

“Never assume the obvious is true.” —  William Safire

“Learning is not attained by chance; it must be sought for with ardor and attended to with diligence.” – Abigail Adams

“All warfare is based on deception. There is no place where espionage is not used. Offer the enemy bait to lure him.” —Sun Tzu

“The simplest acts of kindness are by far more powerful than a thousand heads bowing in prayer.” ― Mahatma Gandhi

“I wish I could show you when you are lonely or in darkness the astonishing light of your own being.“ – Hafiz

“It is a fair, even-handed, noble adjustment of things, that while there is infection in disease and sorrow, there is nothing in the world so irresistibly contagious as laughter and good humor.” – Charles Dickens

“The foundation of national morality must be laid in private families.” —John Adams

“More tears are shed over answered prayers than unanswered ones.”– Teresa of Ávila

“Our doubts are traitors, and make us lose the good we oft might win, by fearing to attempt.“ – William Shakespeare

“We are all visitors to this time, this place. We are just passing through. Our purpose here is to observe, to learn, to grow, to love… and then we return home.” — Aboriginal Australian proverb

“Diligence is the mother of good fortune, and idleness — its opposite — never brought a man to the goal of any of his best wishes.” – Miguel de Cervantes

Pandemic Resulted in Less Workers’ Compensation Fraud Claims

New York State Inspector General Lucy Lang on released the 2021 Workers Compensation Fraud Annual Report, publishing results on workers’ compensation claims and fraud investigation results last year.

With New Yorkers beginning to come back to work, new workers’ compensation claims rose slightly in 2021 but continued to be reported at more than 18% lower than pre-pandemic levels, according to the report.

Additionally, while courts across New York State reopened in 2021, a significant backlog caused by closures during the pandemic resulted in the limitation or delay of criminal proceedings and the presentation of new cases to grand juries by district attorneys throughout the state, according to the IG.

Investigations conducted by the WCFIG led to criminal prosecutions resulting in seven arrests, including one arrest involving a provider/professional matter, four involving employer matters and two involving claimant matters.

Additionally, through completed prosecutions in 2021, WCFIG’s investigations facilitated the recovery of hundreds of thousands of dollars in fines and orders of restitution for New York State agencies, insurers including the New York State Insurance Fund and private insurers, and self-insured employers that were the victims of workers compensation fraud.

In 2021, WCFIG received 1,118 fraud complaints in total and dismissed 492 matters as unsubstantiated.

Even if no one was working in a job where they could be hurt, seven arrests, and the recovery of some money, is a woefully bad result for the insurance fraud investigators and prosecutors. A pandemic is no excuse for not arresting and convicting more than 600 fraud complaints that were not unsubstantiated. The workers’ compensation insurance industry in New York should be ashamed for only filing 1,118 fraud complaints, almost 500 of which were unsubstantiated. Since New York releases violent criminals with no bail to offend again ZIFL shouldn’t be surprised at the weak results.

Free Insurance Videos

Barry Zalma, Esq., CFE has published five days a week videos on insurance claims, insurance claims law, insurance fraud and insurance coverage matters at

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at

http://www.zalma.com

and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 53 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

See the more than 388 videos at https://www.rumble.com/zalma

“Insurance Fraud – Volume I & Volume II, Second Edition” Now Available

Insurance fraud continually takes more money each year than it did the last from the insurance buying public. No one knows the actual amount with any certainty because most attempts at insurance fraud succeed. Estimates of the extent of insurance fraud in the United States range from $87 billion to more than $300 billion every year. Insurers and government backed pseudo-insurers can only estimate the extent they lose to fraudulent claims. Lack of sufficient investigation and prosecution of insurance criminals is endemic. Most insurance fraud criminals are not detected. Those that are detected do so because they became greedy, sloppy and unprofessional so that the attempted fraud becomes so obvious it cannot be ignored.

No one will ever be able to place an exact number on the amount lost to insurance fraud. Everyone who has looked at the issue knows – whether based on their heart, their gut or empirical fact determined from convictions for the crime of insurance fraud – that the number is enormous. When insurers and governments put on a serious effort to reduce the amount of insurance fraud the number of claims presented to insurers and the pseudo-government-based or funded insurers drops logarithmically.

When insurers and governments put on a serious effort to reduce the amount of insurance fraud the number of claims presented to insurers and the pseudo-government-based or funded insurers drops logarithmically. The effort to stop insurance fraud against Medicare and Medicaid has increased in recent years. This book contains appellate decisions regarding insurance fraud from federal and state appellate courts across the country and full text of many insurance fraud statutes. It is available as both a legal research tool and a product to assist insurers, insurance company personnel, independent insurance adjusters, special investigation unit investigators, state fraud investigators and insurance lawyers to become effective persons involved in the attempt to defeat or reduce the effect of insurance fraud.

Volume I includes the following:

• Insurance Fraud is Epidemic.

• Measuring Insurance Fraud

• What is Insurance Fraud?

• Arson for profit.

• Soft Fraud

• Hard Fraud

• Insurance Against the Risk of Loss of Real or Personal Property

• Liability Insurance

• Interpretation of Insurance Contracts

• Ethics & The Insurance Fraud Investigation

• Fraud by Professionals

• First Party Property Fraud

• Health Insurance Fraud

• Insurance Fraud is a Crime

• Fraud Created by Legal Professionals

• Fraud in the Acquisition of Insurance

• Fraud in the Presentation of a Claim

• Investigation of a Claim for Fortuity

• Investigating Fraud

• Arson for Profit Investigation

• Investigation Methods

• Evaluation of Medical Records

Available as a Kindle book; Available as a Hardcover;  Available as a Paperback

Volume II of Insurance Fraud provides coverage of the issues not covered by Volume I and, together with Volume I becomes a complete manual for how lawyers and claims people can effectively work to deter or defeat insurance fraud.

Volume II includes the following:

The following are covered in this volume including:

• The Federal Crime of Insurance Fraud

• Insurance Fraud as a State Crime

• Insurance Fraud by Insurers

• California SIU Regulations

• Investigating Insurance Fraud

• The Examination Under Oath

• The Taking of an Examination Under Oath

• The Mutability of Memory

• Rescission

• Insurance Fraud Statutes

• The Tort of Bad Faith and Insurance Fraud

• Sample California Rescission Letters

• Sample Complaint for Declaratory Relief

• Form of Mutual Rescission Agreement

• Form Declaration of Underwriter in Support of Rescission

• Insurance Fraud Statutes

• Outline of Training for Integral Anti-Fraud Personnel

• Form of EUO Demand Letter

• EUO Testimony admitting fraud.

Available as a Kindle book;  Available as a Hardcover;  Available as a Paperback

Good News From the

The unanimous decision by the state’s highest court answered a certified question from the U.S. District about personal liability for alleged bad-faith claim handling. “Given the plain statutory language, we answer that question in the negative. An action for unreasonably delayed or denied insurance benefits under Colorado law may be brought against an insurer, not against an individual adjuster acting solely as an employee of the insurer,” the court ruled. Coalition law firm member Greenberg Traurig authored our successful amicus brief. Coalition members APCIA and State Farm also submitted amicus briefs. The Coalition won a similar decision before the Washington State Supreme Court by a single vote in 2019. Earlier this year, New Jersey became an outlier — adopting personal bad-faith liability through a new state law dealing with uninsured and underinsured motorist coverage. That misconceived law is the subject of our latest Journal of Insurance Fraud in America article.

Angela Marie Farr robbed a federal program for disabled vets, faking severe injuries as part of a $475,741 disability con. A Naval vet, the Leonardtown, Md. woman first lied she had PTSD after being sexually assaulted while on duty three years earlier. Farr also falsely claimed she was seriously injured when she was struck by a drunk driver while driving on duty. She suffered from chronic neck and back pain as a result, she lied. Farr forged 70 pages of Navy medical records supposedly written by investigators, psychologists and physical therapists. The Veterans Administration thus rated Farr 70% disabled. She then chased yet more disability money. Farr claimed a traumatic brain injury and other grave injuries from a vehicle crash. She again sent dozens of forged fraudulent medical documents — using the names of real and fake physicians. Farr claimed she was paralyzed from the waist down, suffered multiple seizures daily, and required round-the-clock care for basics such as toileting and showering. She also claimed an aneurysm, heart attack and leukemia. The VA increased her disability rating to 100%, and awarded her special monthly compensation for in-home nursing care. Farr pled guilty and could spend up to 15 years in federal prison when sentenced Aug. 4

Throwing away an acclaimed medical career for illegal kickback dollars, Leonard Rosen will have a lifetime to regret his moves. The OB-GYN delivered more than 10,000 babies in Northern Virginia for over 40 years. He did humanitarian work in Bolivia. Rosen also developed less-invasive and more-affordable robotics surgical treatments. He even gave free treatment to women who couldn’t afford care. Then Rosen’s career went south. Calling his crimes “a significant lack of judgment,” he took about $100,000 in bribes disguised as “speaker bureau” engagements. In exchange, Rosen prescribed expensive insurer-paid compound scar cream to his surgical patients. He also over-billed some patients as an out-of-network provider, when he was actually in their insurance network. That scheme stole nearly $53,000. Rosen admitted to the kickbacks. He received two years of federal probation, lost his license and must repay $1.3 million to the victim insurers. “It’s a sad case, because Dr. Rosen by all accounts is a fantastic physician, and he unfortunately got lured into a scheme not of his own making,” his defense attorney Stuart Sears says.

Two killers cooked up the murder of a popular chef for $800,000 of life insurance in California’s Bay Area. Maria Moore had a relationship with Dominick Sarkar. Sarkar was head chef at the Indian restaurant Rangoli, in Fremont. He was shot to death while sleeping in his rented home nearby. Sarkar had bought a $500,000 life policy, listing his three daughters in India as beneficiaries. Moore then altered the policies to make her the primary beneficiary. Sarkar added a $300,000 policy a year later, also listing his daughters as beneficiaries. Moore again had herself installed as primary beneficiary. She next wired $500 to hitman Marvel Salvant less than a month before he shot Sarkar — they also had a relationship. Surveillance video shows Salvant’s vehicle casing Sarkar’s home days before his murder. A male is then seen riding a bicycle toward Sarkar’s home from where Salvant’s vehicle had parked. Minutes after the shooting, the same male returns to the vehicle. Cell data then shows Salvant leaving the area back to his home in the Sacramento area. Salvant also texted Moore the night of the murder: “It’s a waiting game” and “I am set to do everything tonight.” Moore and Sarkar were given life without parole in state prison. 

Addicted patients were drugged and sedated so two brothers could inhale $112 million of insurance money for bogus, unneeded and excessive rehab in South Florida. Jonathan Markovich and brother Daniel ran Compass Detox and the outpatient treatment facility WAR Network. They bought in patients by paying them illegal kickbacks such as free airline tickets, illegal drugs and cash. The brothers shuffled patients between Compass Detox and WAR in a cycle of admissions and readmissions to fraudulently over-bill insurers. Recruiters also gave patients illegal drugs to ensure admittance for detox — their most-expensive addiction treatment. Therapy sessions were billed, but not regularly held or attended. Excessive and medically unneeded urine tests also were billed. And Compass patients were given a “comfort drink” to sedate them, and keep them coming back. Patients also were given large and potentially harmful amounts of other drugs to keep them compliant and docile — and ensure they stayed with the outpatient facility. Jonathan was handed 188 months in prison, and Daniel 97 months.

Prisoner States Frivolous Cause of Action for Fraud

Insurance fraud is both civil and criminal. One who is a victim of insurance fraud can assert a claim against the fraudster if there is a preponderance of the evidence available. When a plaintiff files suit acting in pro se – as his own lawyer – the courts will bend over backwards to find a way for the plaintiff to state a cause of action. The court will not, however, allow a frivolous action to proceed.

In Chijioke Isamade v. Elexis Bernal, No. 2:22-cv-0334-JAM-CKD PS, United States District Court, E.D. California (March 14, 2022) Chijioke Isamade requested to proceed in forma pauperis. Plaintiff’s application made the showing required by 28 U.S.C. § 1915. The motion to proceed in forma pauperis was granted.

Regardless, of the fact that the plaintiff is a pauper, the court must still screen every in such proceeding, and must order dismissal of the case if it is frivolous or malicious, fails to state a claim on which relief may be granted, or seeks monetary relief against a defendant who is immune from such relief.

A CLAIM CAN BE FRIVOLOUS

A claim is legally frivolous when it lacks an arguable basis either in law or in fact. [Neitzke v. Williams, 490 U.S. 319, 325 (1989).] In reviewing a complaint under this standard, the court accepts as true the factual allegations contained in the complaint, unless they are clearly baseless or fanciful, and construes those allegations in the light most favorable to the plaintiff.

Pro se pleadings are held to a less stringent standard than those drafted by lawyers. However, the court need not accept as true conclusory allegations, unreasonable inferences, or unwarranted deductions of fact.

To state a claim on which relief may be granted, the plaintiff must allege enough facts to state a claim to relief that is plausible on its face. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.

Plaintiff is currently confined at the Sacramento County Main Jail. Plaintiff’s Mercedes Benz truck was parked at defendant Elexis Bernal’s address while plaintiff was in federal custody at the jail from November 1, 2018, until October 19, 2021. Plaintiff alleges that sometime in 2019 or 2020, Bernal stole plaintiff’s DMV vehicle title out of the truck. Bernal then forged plaintiff’s initials and signature at the DMV, replacing Bernal’s name on the title in order to permanently deprive plaintiff of the truck. When plaintiff’s wife attempted to retrieve the truck from Bernal’s address, Bernal waited in hiding and hit plaintiff’s wife with a motor vehicle, causing severe injuries to plaintiff’s wife.

On a subsequent date, plaintiff’s wife entered Bernal’s home without express permission because Bernal had contacted plaintiff’s wife to attempt to blackmail plaintiff in exchange for his truck. Bernal had plaintiff’s wife arrested and then received $31,000 through an insurance claim based upon the incident, which plaintiff alleges was fraudulent. Bernal pressed charges and plaintiff’s wife is being held accountable.

Plaintiff alleged Bernal has bragged to plaintiff on a federally recorded phone call about running over plaintiff’s wife and getting rich off insurance fraud. In addition, plaintiff alleges Bernal illegally filed plaintiff’s tax returns and has obtained fraudulent PPP loans, EDD, and stimulus checks.

Plaintiff states he is suing Bernal for IRS tax fraud, insurance fraud, DMV Title fraud, larceny, and attempted murder of his wife. For relief, plaintiff seeks to have the insurance funds refunded and monetary relief in the amount of $50,000.

Although plaintiff seeks to hold Bernal liable for various alleged criminal acts, plaintiff provides no authority for the proposition that he has a private right of action to assert a violation of criminal statutes, and no such right generally exists. Unless there is a clear congressional intent to provide a civil remedy, a plaintiff cannot recover civil damages for an alleged violation of a criminal statute. Plaintiff also does not state a cognizable claim for a violation of his constitutional rights.

Plaintiff does not state a claim because the complaint does not allege a violation of plaintiff’s constitutional rights or federal law. In addition, plaintiff does not state a claim because the complaint does not allege the involvement of any federal officials or persons acting under color of state law. Instead, the complaint involves the conduct of a single defendant who is a private actor.

Leave to amend is useless since it is clear the deficiencies in the complaint cannot be cured by alleging additional facts. Under these circumstances, leave to amend would be futile.

ZIFL OPINION

This was the decision of a Magistrate judge and the District Court Judge is not obligated to follow the decision. The California Insurance Frauds Act, California Penal Code Section 550 allows for a qui tam action on behalf of the state, which Isamade did not plead and probably could not plead. Otherwise, his entire action is frivolous. His wife could always file a suit for her personal injuries.

Health Insurance Fraud Convictions

Fake Signatures, Drug Addicts, Homeless Used to Defraud Results in 130 Months in Prison

Keowsha Golden, a South Carolina woman was sentenced to more than a decade behind bars after pleading guilty for her part in a drug conspiracy. The scam that sent to federal prison involved prescription pads, faked signatures, and taking advantage of drug addicts and the homeless, the U.S. Attorney’s Office said in a news release.

The 36-year-old Greenville resident obtained prescription paper and forged physician information to write prescriptions for 30 milligram oxycodone tablets. Information about how Golden got the prescription pads, and the doctors she pretended to be to get the opioids, was not available. Once she had the phony documents, Golden used drug addicts and the homeless to get the oxycodone prescriptions filled.

The prescriptions were passed at various pharmacies in the Upstate region of South Carolina and in western North Carolina. Golden provided the prescription passers with the money to pick up the drugs, as well as fraudulent identification documents. Golden sold the bottles of oxycodone tablets at the wholesale rate of $2,800 to $3,500 per bottle.

There was no word how law enforcement officers first connected Golden to the scam. But during a search of her home, the U.S. Attorney’s Office said law enforcement officers seized Golden’s personal telephone and laptop — which revealed fraudulent prescription templates, physician information, and copies of driver’s licenses used by prescription passers at various pharmacies.

Members of the Drug Enforcement Administration, South Carolina Department of Health and Environmental Control, Laurens Police Department, and Greenville Police Department participated in the investigation. After pleading guilty, Golden was sentenced to 130 months imprisonment, to be followed by a three-year term of court-ordered supervision. There is no parole in the federal system.

The conviction was not Golden’s first run in with law enforcement officers.

The State Now is the modern, digital connection to the traditional print experience. Golden has a lengthy criminal record dating back to 2004, in both Greenville and Anderson counties, and has been convicted on charges of obtaining a signature under false pretenses, multiple counts of passing fraudulent checks, multiple counts of financial identity fraud, multiple counts of drug possession, shoplifting, malicious injury to animals or personal property, trespassing, and neglect, among other offenses, court records show. In a similar incident in September 2012, Golden was pregnant when she was arrested for getting a prescription filled with forged documents at a pharmacy in Anderson County. In March 2014, she pleaded guilty to a drug possession charge from the arrest.

Man Admits Role In $35 Million Pharmacy Compounded Medication Scheme

Robert Schneiderman, 79, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to two counts of an indictment charging him with one count of conspiracy to commit health care fraud and one count of conspiracy to violate the Anti-Kickback Statute.

Schneiderman, a Langhorne, Pennsylvania, admitted on March 29, 2022 to participating in a massive compounded-medication kickback scheme that he and others ran out of a pharmacy in Clifton, New Jersey, U.S. Attorney Philip R. Sellinger announced.

According to documents filed in this case and statements made in court:

From 2014 through 2016, Schneiderman and his conspirators used Main Avenue Pharmacy, a mail-order pharmacy with a storefront in Clifton, to run a fraud and kickback scheme involving compounded drugs like scar creams, pain creams, migraine mediation, and vitamins. Schneiderman was the President of Main Avenue Pharmacy and was a founder and CEO of its corporate parent.

The scheme revolved around identifying compounded drugs that would yield exorbitant reimbursements from health insurers, including both federal and commercial payers. Once Main Avenue identified lucrative formulas for compounds, it would create large prescription pads with precisely those formulas on it. The prescription pad was extremely easy to use – it included check boxes for doctors to select a particular compounded formula. This increased the likelihood that the doctor would not alter the high-paying formula. There was also a place to select up to a dozen refills and a box authorizing the pharmacy to alter the ingredients itself in case an insurer wasn’t covering a particular compounded medication.

Once the prescription pad was set, Main Avenue would disseminate it to its stable of marketers across the country, with whom it had contractual relationships. The marketing companies would in turn distribute the prescription pad to telemedicine companies and doctors with whom they had a financial arrangement.

Physicians who signed prescriptions for compounded medications that were filled at Main Avenue often had never even spoken to the patient, let alone examined him or her. Once the prescriptions were signed by a doctor, they would be returned to Main Avenue Pharmacy. Main Avenue would then fill the prescription regardless of its medical necessity and then submit claims to health care benefit programs for reimbursement. They did so with federal payers like Medicare and Tricare and with commercial payers in New Jersey and elsewhere.

After Main Avenue obtained reimbursement from the health insurers, they would pay kickbacks to the marketers who had generated the prescriptions based on the overall adjudication amount. Main Avenue signed contracts with many of the marketers, and the contracts themselves spelled out the kickback arrangement, which called for Main Avenue to pay each marketer money based on the volume of referrals of compounded prescriptions and the reimbursement amount that Main Avenue received.

As part of the scheme, Main Avenue would routinely waive co-payments of the patients to whom they were sending multiple prescriptions. It did this to ensure that the patients would keep the medications that Main Avenue had sent regardless of whether the patient wanted them. On some occasions, Main Avenue Pharmacy paid the co-payments on behalf of the patients, and falsified money orders from the patients to Main Avenue to make it appear as if the patients had paid their co-payments when they had not.

On compounded medications alone, Main Avenue received over $34 million in reimbursements from health care benefit programs. Approximately $8 million of that total was paid by federal payers. Schneiderman himself earned over $400,000 through the course of the scheme.

The count of conspiracy to commit health care fraud carries a maximum penalty of 10 years in prison. The count of conspiracy to violate the Anti-Kickback Statute carries a maximum penalty of five years in prison. Both counts also are punishable by a maximum fine of $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Sept. 16, 2022.

Ambulance Company Pays Over $600k To Settle Allegations It Submitted Improper Claims

American Medical Response of Connecticut, Inc. (“AMR”), has entered into a civil settlement agreement with the federal and state governments and has paid $601,759 to resolve allegations it submitted improper claims to Medicare and Medicaid for ambulance services. AMR is an ambulance company operating in Connecticut.

There are various types of services related to ambulance billing. Advanced Life Support services (“ALS”) include services performed by a paramedic at the scene of an emergency response and in the ambulance. ALS services require a high level of medical monitoring. Basic Life Support services (“BLS”) are lower acuity services that can be performed by an emergency medical technician-basic, or relate to the transport of the patient in the ambulance to a hospital or other medical facility. In several towns in Connecticut, local fire departments provide ALS emergency services when a 911 call is dispatched. AMR is also dispatched to the scene of these calls to provide ambulance transport only (a BLS service). When the fire department and AMR are on the scene together, it is a “joint response.”

The federal and state governments allege that AMR would often bill Medicare and Medicaid for ALS (paramedic) services when it was only providing the BLS (ambulance transport) services.

For claims submitted to Medicare, billing for ALS services in “joint response” situations would have been proper if AMR had a written billing agreement in place with the local fire departments, which it did not during relevant time period. For claims submitted to Connecticut Medicaid, in many cases, both AMR and the local fire departments billed Medicaid for ALS/paramedic services. As a result, Medicaid actually paid twice for the paramedic services, once to the local fire departments and a second time to AMR. 

To resolve the governments’ allegations, AMR paid $601,759, which covers claims submitted to the Medicare and Medicaid from January 2014 through December 2019.

AMR also entered into a consent agreement the with the Connecticut Department of Public Health in which they agreed to cease and desist the prohibited conduct and to pay a $25,000 civil penalty to the State of Connecticut.

If AMR was willing and able to pay ZIFL assumes they stole twice as much so that they had the money available to pay.

Former Employee Benefits Solutions CFO Sentenced to Four Years In $33 Million Fraud Scheme

Erin Verespy, 50 of Trumbull, Connecticut, previously pleaded guilty to her role in the scheme to misappropriate client health care funds and defraud multiple lenders through her official role as the former CFO of Employee Benefit Solutions LLC, according to the U.S. Attorney’s Office.

Verespy, who was EBS’ CFO from at least July 2017 through 2019, pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud. She was also sentenced to five years of supervised release, according to officials. Verespy must pay $16.1 million in restitution and forfeit $1.1 million

Also charged were EBS President Patricia Riccardi; EBS Executive Vice President Anthony Riccardi; and EBS Vice President of Client Services Vanessa Battle. No information about their cases was provided in the latest release.

EBS offered a variety of health care insurance-related services to clients, according to the U.S. Attorney’s Office statement. Among other things, they provided third-party healthcare claims administration services to clients who “self-funded” (or self-insured) their employee health care plans. EBS would administer, process, and pay health care claims for its clients’ employees in exchange for an administrative fee.

EBS generated bimonthly “check register” invoices for the car dealerships it served. These invoices listed all employee health care expenses from health care providers for two-week periods.

EBS also managed a bank account expressly dedicated to paying the dealership’s employees’ health care claims, officials said. The dealership would pay the invoiced amount for each check register, expecting that EBS would pay the claims to the health care providers. In all, the dealership transferred about $26 million to EBS for the payment of health care claims.

However, a significant amount of purported checks listed on the EBS “check register” invoices were allegedly never actually deposited by the health care providers. About $17.87 million of this money was misappropriated, with EBS transferring this money into its own account. EBS managers and owners then used this money for their own, non-health care expenses.

For example, Verespy and her co-conspirators allegedly used the money to pay their home mortgage expenses, as well as a personal credit card account with expenses relating to boating, luxury cars, and golf. Veresepy personally made more than $1 million as a result of her participation in the scheme, officials said.

Outstanding fiduciary obligations began to mount for EBS, which began to buckle by the middle of 2017. At that point, the co-conspirators began to apply for multiple fraudulent bank loans and merchant cash advances designed in part to pay the money that EBS owed to the dealership.

In March, the former owner of a health insurance plan and two co-conspirators were charged in a similar scheme that defrauded more than 400,000 people nationwide out of more than $190 million over a six-year span.

Guilty of Health Care Fraud, Money Laundering, And Theft of Public Money

Rodney L. Yentzer, age 52, of Cumberland County, Pennsylvania, pleaded guilty to conspiracy to commit health care fraud, conspiracy to commit money laundering, and theft of public money for defrauding Medicare, Medicaid, and the U.S. Department of Health and Human Services between 2016 and 2020. Yentzer also agreed to pay $3,869,571.55 in restitution for these offenses.

Yentzer agreed with others to defraud Medicare and Medicaid by submitting medically unnecessary urine drug tests for patients at clinics he controlled, including a group of pain clinics known as Pain Medicine of York or “PMY” (also known as All Better Wellness).

PMY billed Medicare for more than $10 million in urine drug tests from mid-2017 through the end of 2019. As a result, Medicare paid out over $4 million for these urine drug tests. Pennsylvania’s Medicaid program was also billed for urine drug tests during this same time period. The urine drug tests ordered by PMY were sent to an in-house laboratory at PMY whenever possible. As a result, when medically unnecessary tests were billed to Medicare, the proceeds from them went to PMY itself.   

Search warrants were executed at PMY’s various locations in November 2019, and PMY ceased operations soon after that.

Thereafter, in a separate offense, Yentzer sought and received over $191,000 in U.S. Department of Health and Human Services stimulus money that was intended for health care providers who had health care related expenses and lost revenues attributable to COVID-19. Yentzer obtained these funds in April 2020, even though he had resigned from PMY the prior month and PMY had been closed since late 2019. Yentzer used these funds on various things unrelated to COVID-19 relief, including personal expenses.

The maximum penalty under federal law for conspiracy to commit health care fraud is 10 years’ imprisonment. The maximum penalty law for conspiracy to commit money laundering is 20 years’ imprisonment. The maximum penalty law for theft of public money is 10 years’ imprisonment. These charges may also carry a fine and a term of supervised release following imprisonment. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

Addiction Treatment Facilities’ Medical Director Convicted In $112 Million Addiction Treatment Fraud

Jose Santeiro, 72, of Miami Lakes, Florida, a doctor, worked with others to unlawfully bill for approximately $112 million of addiction treatment services that were never rendered and/or were medically unnecessary at two addiction treatment facilities where Santeiro was the Medical Director. The facilities were Second Chance Detox LLC, dba Compass Detox (Compass Detox), an inpatient detox and residential facility, and WAR Network LLC (WAR), a related outpatient treatment program.

The Medical Director of two South Florida addiction treatment facilities was convicted today after a 15-day trial of engaging in a scheme that fraudulently billed approximately $112 million for substance abuse services that were never provided or were medically unnecessary.

According to court documents and evidence presented at trial, Santeiro the evidence showed that Santeiro and others admitted patients for medically unnecessary detox services, the most expensive kind of treatment the facilities offered. Patient recruiters offered kickbacks to induce patients to attend the programs and then gave them illegal drugs to ensure admittance for detox at Compass Detox. Evidence at trial also showed that Santeiro submitted false and fraudulent claims for excessive, medically unnecessary urinalysis drug tests that were never used in treatment. Santeiro and others then authorized the readmission of a core group of patients who were shuffled between Compass Detox and WAR to fraudulently bill for as much as possible, even though the patients did not need the expensive treatment for which they were repeatedly admitted. Santeiro also prescribed Compass Detox patients with a so-called “Comfort Drink” to sedate them, ensure they stayed at the facility, and keep them coming back. The evidence further showed that Santeiro’s log-in was used, with his knowledge, by others to sign electronic medical files to make it appear as if Santeiro had provided treatment himself when he did not.

Santeiro was convicted of conspiracy to commit health care fraud and wire fraud and eight counts of health care fraud. He faces up to 20 years in prison for the conspiracy count and up to 10 years in prison for each health care fraud count. A federal district court judge will determine the sentences after considering the U.S. Sentencing Guidelines and other statutory factors.

Physician Sentenced to Prison for Health Care Fraud Scheme

Mark Alan Zager, 72, of Miami, conspired with Dennis Nobbe, a now-deceased chiropractor and owner of Dynamic Medical Services, located in Hialeah, Florida, to defraud Medicare, individual patients, and a financial services company. Zager, a Florida physician was sentenced March 24, 2022 in the Southern District of Florida to only two years in prison for a health care and wire fraud scheme involving the submission of false and fraudulent claims to both Medicare and a financial services company that offered consumer loans to patients for out-of-pocket medical expenses.

According to court filings and evidence presented during court proceedings. Zager opened a merchant account in his own name and allowed Nobbe to use the account in exchange for paying kickbacks and bribes to Zager. Through the account, Nobbe routinely applied for loans on patients’ behalf, purportedly for services that would be rendered months in the future but were not provided.

According to court filings and evidence presented during court proceedings, from November 2019 through July 2020, Zager and Nobbe submitted more than $193,000 in false and fraudulent loan applications to a financial services company, resulting in that company paying out approximately $165,000. Additionally, Zager allowed Nobbe to submit claims to Medicare through Zager’s National Provider Number in exchange for kickbacks and bribes. Between December 2019 and July 2020, Zager and Nobbe submitted approximately $19,000 in false and fraudulent claims to Medicare. 

Zager pleaded guilty on June 1, 2021 to one count of conspiracy to commit wire fraud and one count of health care fraud. Nobbe was charged with several federal crimes by criminal complaint on July 23, 2020, but he passed away on September 14, 2020, after which the complaint was dismissed, and he accordingly remains presumed innocent.

Nurse Sentenced for Fraudulently Obtaining Narcotics

Jadelyn Marie Maher, age 39, of Council Bluffs, Iowa was sentenced March 22, 2022 in federal court to six months in prison for Acquiring a Controlled Substance by Misrepresentation, Fraud, Deception and Subterfuge. Her term of imprisonment will be followed by one year of supervised release. Maher was also ordered to pay a $3,000 fine. According to court documents, Maher pleaded guilty to the charge on November 4, 2021.

Maher was employed as a registered nurse at facilities where she falsified health care records and narcotics log sheets when she checked out narcotics/opioids for patients. Maher took the Hydrocodone and Oxycodone pills for her own use. Maher’s nursing license was forfeited by the Court.

Ten Texas Doctors Agree to Pay Over $1.68 Million To Settle Kickback Allegations

Cash Instead of Jail Total of Eighteen Texas Doctors Have Settled Related Healthcare Fraud Allegations

Ten additional Texas doctors and a healthcare executive have agreed to pay a total of $1,680,430 to resolve False Claims Act allegations involving illegal kickbacks in violation of the Anti-Kickback Statute and Stark Law, and to cooperate with the Department’s investigations of and litigation against other parties, announced Eastern District of Texas U.S. Attorney Brit Featherston today.

The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded programs. The Stark Law forbids a hospital or laboratory from billing Medicare for certain services referred by physicians that have a financial relationship with the hospital or laboratory. The Anti-Kickback Statute and the Stark Law are intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.

The settlements announced March 22, 2022 resolve allegations that ten Texas doctors violated the Anti-Kickback Statute by receiving thousands of dollars in remuneration from eight management service organizations (MSOs) in exchange for ordering laboratory tests from Rockdale Hospital d/b/a Little River Healthcare (Little River), True Health Diagnostics LLC (True Health), and/or Boston Heart Diagnostics Corporation (Boston Heart). Little River allegedly funded the remuneration to certain doctors, in the form of volume-based commissions paid to independent contractor recruiters, who used MSOs to pay numerous doctors for their referrals. The MSO payments to the doctors were allegedly disguised as investment returns but in fact were based on, and offered in exchange for, the doctors’ referrals. 

• Tamar Brionez, M.D., of Spring, Texas, agreed to pay $85,006 to settle allegations that from March 14, 2016 to March 16, 2017 she received kickbacks from an MSO, Tomball Medical Management, Inc., in exchange for ordering laboratory tests from Little River.

• Gary Goff, M.D., of Dallas, Texas, and two affiliated entities, Gary Goff, MD, PA and DFW Primary Medical Alliance, LLC, agreed to pay $454,088 to settle allegations that from August 5, 2015 to September 7, 2018 he and his entities received kickbacks from two MSOs, Alpha Rise Health, LLC and HALOS Clinical Management, LLC, in exchange for ordering laboratory tests from True Health and Little River.

• John Hierholzer, M.D., of San Antonio, Texas, agreed to pay $24,850 to settle allegations that from May 18, 2015 to February 12, 2016, he received kickbacks from an MSO, Alpha Rise Health, LLC, in exchange for ordering laboratory tests from Boston Heart and Little River.

• Bruce Maniet, D.O., of Bells, Texas, agreed to pay $175,436 to settle allegations that from January 18, 2016 to October 23, 2017 he received kickbacks from two MSOs, Ascend MSO of TX, LLC and Herculis MG LLC, in exchange for ordering laboratory tests from Boston Heart and Little River.

• Huy Chi Nguyen, M.D., of Arlington, Texas, agreed to pay $211,821 to settle allegations that from October 30, 2015 to December 31, 2017 he received kickbacks from (a) one MSO, Ascend MSO of TX, LLC, in exchange for ordering laboratory tests from True Health and Little River; and (b) another MSO, Geminorium MG LLC, in exchange for ordering laboratory tests from Boston Heart.

• Dung Chi Nguyen, M.D., of Arlington, Texas, agreed to pay $211,721 to settle allegations that from November 4, 2015 to December 31, 2017 he received kickbacks from (a) one MSO, Ascend MSO of TX, LLC, in exchange for ordering laboratory tests from True Health and Little River; and (b) another MSO, Geminorium MG LLC, in exchange for ordering laboratory tests from Boston Heart.

• Rakesh Patel, D.O., of Houston, Texas, agreed to pay $174,539 to settle allegations that from August 25, 2015 to April 19, 2017 he received kickbacks from an MSO, SYNRG Partners LLC, in exchange for ordering laboratory tests from True Health and Little River.

• Cuong Trinh, M.D., of Houston, Texas, agreed to pay $45,056 to settle allegations that from July 28, 2015 to August 30, 2016 she received kickbacks from an MSO, SYNRG Partners LLC, in exchange for ordering Boston Heart laboratory tests from Little River.

• Randall Walker, M.D., of Magnolia, Texas, agreed to pay $60,898 to settle allegations that from November 7, 2014 to August 28, 2015 he received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in exchange for ordering laboratory tests from Little River.

• Michael Whiteley, D.O., of Tomball, Texas, agreed to pay $52,015 to settle allegations that from January 5, 2015 to July 10, 2015 he received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in exchange for ordering laboratory tests from Little River.

As part of their settlements, the ten physicians have agreed to cooperate with the Department of Justice’s investigations of and litigation against other parties involved in the alleged violations of law.

In addition, the United States announced a settlement with Brett Markowitz, the founder and CEO of Florida Rejuvenation Holdings, LLC, which operates medical practices in Tampa, Florida (collectively, the Tampa Practices). From October 18, 2016 through February 19, 2018, True Health representatives allegedly arranged for True Health to pay for each patient that physicians at the Tampa Practices referred to True Health for clinical laboratory services. True Health allegedly initially paid $25 per referral to The Blood Spot, Inc. (TBS), a company associated with and controlled in part by a True Health representative, and True Health allegedly subsequently paid $35 per referral to Express Mobile Labs, LLC (EML), a company associated with and controlled in part by Markowitz. True Health, TBS, EML, and Markowitz allegedly disguised the payments as purported processing and handling (P&H) fees. As alleged, True Health and Markowitz knew and intended that TBS and EML would pay some or all of True Health’s P&H fee payments to Markowitz, directly or indirectly, in cash or in kind. Pursuant to the alleged arrangement, True Health billed the resulting claims to Medicare and other federal healthcare programs. Under the terms of the settlement agreement, Markowitz agreed to pay $185,000 and to cooperate with the Department’s investigations of and litigation against other parties.

Addiction Treatment Facility Operators Sentenced In $112 Million Addiction Treatment Fraud Scheme

Jonathan Markovich, 37, and his brother, Daniel Markovich, 33, both of Bal Harbour, Florida were sentenced in the Southern District of Florida to 188 months and 97 months in prison, respectively.

The two brothers who operated multiple South Florida addiction treatment facilities were sentenced to prison in March 2022 for a $112 million addiction treatment fraud scheme that included paying kickbacks to patients through patient recruiters and receiving kickbacks from testing laboratories.

According to court documents and evidence presented at trial, the defendants conspired to unlawfully bill for approximately $112 million of addiction treatment services that were medically unnecessary and/or never provided, which were procured through illegal kickbacks at two addiction treatment facilities, Second Chance Detox LLC, dba Compass Detox (Compass Detox), an inpatient detox and residential facility, and WAR Network LLC (WAR), a related outpatient treatment program. The defendants obtained patients through patient recruiters who offered illegal kickbacks to patients, including free airline tickets, illegal drugs, and cash payments. The defendants shuffled a core group of patients between Compass Detox and WAR in a cycle of admissions and re-admissions to fraudulently bill for as much as possible. Patient recruiters gave patients illegal drugs prior to admission to Compass Detox to ensure admittance for detox, which was the most expensive kind of addiction treatment offered by the defendants’ facilities. In addition, therapy sessions were billed for but not regularly provided or attended, and excessive, medically unnecessary urinalysis drug tests were ordered, billed for, and paid. Compass Detox patients were given a so-called “Comfort Drink” to sedate them, and to keep them coming back. Patients were also given large and potentially harmful amounts of controlled substances, in addition to the “Comfort Drink,” to keep them compliant and docile, and to ensure they stayed at the facility.

After a seven-week trial in November 2021, both defendants were convicted of conspiracy to commit health care fraud and wire fraud. Jonathan Markovich was convicted of eight counts of health care fraud and Daniel Markovich was convicted of two counts of health care fraud. They were also both convicted of conspiracy to pay and receive kickbacks and two counts of paying and receiving kickbacks. Jonathan Markovich was separately convicted of conspiring to commit money laundering, two counts of concealment money laundering, and six counts of laundering at least $10,000 in proceeds of unlawful activities. He was also convicted of two counts of bank fraud related to fraudulently obtaining PPP loans for both Compass Detox and WAR during the COVID-19 pandemic.

Potential Deportation for Passport, False Citizenship, False Social Security & Health Care Fraud

Diomedes Ramirez Rodriguez, 47, who has been detained in federal custody since his arrest on March 9, 2021, was sentenced by U.S. District Court Judge Mary S. McElroy to time served – one year and eight days. He was further detained by Immigration and Customs Enforcement awaiting deportation proceedings.

Rodriguez, a Dominican national who resided in Providence is facing deportation after being convicted and sentenced in federal court for falsely representing his citizenship and Social Security number, misusing a passport, and for health care fraud.

Rodriguez pled guilty on December 1, 2021, to false representation of a Social Security number, health care fraud, theft of public money, false representation of citizenship, and misuse of a passport.

According to charging documents, in 2008 and 2010, Rodriquez applied for and received a passport using the personal identifying information of a person living in Puerto Rico. Subsequently, Rodriguez, using the same personal information and that person’s Social Security number, applied for and received a Rhode Island driver’s license and identification card; Supplemental Nutrition Assistance Program benefits totaling $7,342.64; and RI Medicaid Program RIte Care benefits totaling $39,023.61.

Counselor Sentenced to Federal Prison for Wide-Ranging Medicaid Fraud Scheme

CORTNEY DUNLAP, 37, of Burlington, Connecticut was sentenced March 11, 2022 by U.S. District Judge Kari A. Dooley in Bridgeport to 57 months of imprisonment, followed by three years of supervised release, for operating a wide-ranging scheme that defrauded the Connecticut Medicaid Program of more than $1.3 million.

According to court documents and statements in court, from 2014 to 2020, Dunlap was a Licensed Professional Counselor with offices located on Brainard Road in Hartford. Dunlap also owned two entities, Inspirational Care and KEYS Program Inc., through which he managed group homes in Hartford, Bristol, Cromwell and Waterbury, including residences for women and children who were victims of domestic abuse.

From August 2018 through October 2020, Dunlap engaged in a scheme to defraud the Connecticut Medicaid Program by submitting claims for psychotherapy services that were purportedly provided to Medicaid clients.  The vast majority of the claims were for occasions and dates of service when no psychotherapy services of any kind had been provided to the Medicaid clients identified in the claims. On a limited number of occasions, some of the services were rendered by unlicensed individuals who were not qualified or licensed to provide psychotherapy.

The Connecticut Medicaid program suspended Dunlap as a Medicaid provider on approximately April 28, 2020, and, on May 7, 2020, federal law enforcement agents executed a court-authorized search of Dunlap’s Hartford offices.  Dunlap subsequently billed Medicaid for psychotherapy services through Inspirational Care for services that which were not provided, using the provider number of a licensed clinical social worker who did not provide the services and was not aware that her provider number was being used to bill for the nonexistent services.

Dunlap required tenants of the group homes operated or managed by Inspirational Care and KEYS program to provide copies of the Medicaid member cards for the tenants and their children as a condition of the tenants residing at the group homes. Dunlap then used these Medicaid member numbers to bill Medicaid for psychotherapy services that were not provided to the tenants or their children. Dunlap used the Medicaid member numbers of approximately 65 tenants or their children to bill Medicaid for fraudulent services, and Medicaid paid Dunlap approximately $543,117 for psychotherapy services that were not provided to these individuals.

In February 2019, the New Haven Public Schools hired Dunlap as a guidance counselor at the New Haven Adult and Continuing Education Center. In February 2020, Dunlap accessed a database containing personal identifying information of students and former students enrolled at New Haven Adult and Continuing Education, many of whom Dunlap did not have any professional relationship with and had never met. Dunlap used the information he acquired to determine whether the students were insured by Medicaid and, if so, identified the students’ Medicaid member identification numbers. He then billed Medicaid for fraudulent psychotherapy services that were never provided to the students. Dunlap used the personal identifying information and Medicaid member numbers of approximately 135 New Haven Adult and Continuing Education students to bill Medicaid for fraudulent services, and was paid a total of approximately $593,383 by Medicaid for these claims.

Dunlap also fraudulently billed Medicaid for psychotherapy services purportedly provided to employees of Inspirational Care when no such services were provided, and submitted fraudulent claims to Medicaid for psychotherapy services purportedly provided to members of his family when no such services were provided.

Judge Dooley ordered to Dunlap to pay restitution to Medicaid in the amount of $1,313,322.

Dunlap was arrested on a criminal complaint on October 14, 2020. On June 4, 2021, he pleaded guilty to one count of health care fraud. Dunlap, who is released on bond, is required to report to prison on April 25.

Home Health Agency Agrees to Pay $6.53 Million To Masshealth to Resolve Allegations of Fraud

Settlement Negotiated by AG’s Office Also Allocates Up to $375,000 for Unpaid Wages for Past Employees of Compassionate Homecare

Compassionate Homecare, Inc. has agreed to pay $6.53 million to MassHealth to resolve allegations that it billed MassHealth for services that were not authorized by a physician. In addition, up to $375,000 will be set aside for payment of unpaid wages for former Compassionate employees.

The settlement, which has been approved by the United States Bankruptcy Court, resolves a lawsuit filed by the AG’s Office against Compassionate in March 2018 alleging that the company stole millions of dollars from MassHealth.

Compassionate was formed as a home health agency in 2010. In June 2017, the AG’s Fair Labor Division issued three citations against Compassionate totaling $646,714 in restitution and penalties for failure to pay timely wages and overtime to its employees, and failure to keep true and accurate payroll records.

MassHealth provides healthcare products and services to eligible low-income individuals, including people with disabilities, children, and senior citizens. The program pays for three kinds of home health services for eligible members: nursing, home health aide, and therapy. To bill MassHealth for home health services, the member’s physician must review and sign a plan of care certifying that home health services are medically necessary. Home health agencies are required to maintain updated medical records of services provided to each member for at least six years.

In September 2019, Compassionate and its owner, Francis Kimaru, pleaded guilty to separate criminal charges brought by the AG’s Medicaid Fraud Division. As part of that plea, Compassionate and Kimaru admitted to stealing hundreds of thousands of dollars from MassHealth by routinely overbilling and falsely billing for services that were not authorized or provided to patients. Compassionate filed for bankruptcy in May 2020.

Under the terms of this settlement, MassHealth will receive $6.53 million. The settlement agreement also provides that up to $375,000 will be prioritized for distribution by Compassionate’s bankruptcy trustee to the former employees who are owed unpaid wages by Compassionate as part of the company’s bankruptcy proceedings.

Bronx Clinic Owner Sentenced for Stealing More Than $4 Million

Leslie Montgomery Sentenced to 3 to 9 Years in State Prison, Ordered to Pay Millions for Sham Housing Assistance Scheme

Leslie Montgomery, 51, of the Bronx, New York was sentenced for defrauding New York state out of millions of dollars in false Medicaid claims and exploiting low-income New Yorkers. Montgomery — who owned Healthy Living Community Center (Healthy Living) and LCM Livery P/U, Inc. (LCM Livery) — scammed New Yorkers through an elaborate scheme, whereby Montgomery advertised a sham housing assistance program to lure low-income individuals into providing their personal information. She then used the personal information to submit false claims for custom-molded back braces to MetroPlus Health Plan, a Medicaid-funded managed care organization, for braces that were not needed and never ordered by patients. Montgomery was sentenced today in Bronx County Supreme Court to three to nine years in state prison and ordered to pay back more than $4 million dollars in restitution to New York state.

Last month, Montgomery pled guilty to Grand Larceny in the First Degree and Money Laundering in the First Degree, both class B felonies. Her company, LCM Livery, pled guilty to Money Laundering in the First Degree. As outlined in court documents, Montgomery used social media to advertise a sham housing assistance program as a ruse to lure low-income New Yorkers to Healthy Living. Healthy Living then required New Yorkers to divulge personal information, including their Medicaid numbers, in order to qualify for the purported program. But instead of helping people find housing, Montgomery used their information to submit false claims to MetroPlus for highly customized back braces that she never provided to the Medicaid recipients. From time to time, Montgomery provided a $20 “off-the-shelf” back brace that was mailed directly from Amazon to the recipient. However, most of the time, she never provided a back brace at all, and yet still billed MetroPlus between approximately $750 to $1,550 per item.

As part of her guilty plea, Montgomery admitted to submitting false Medicaid claims to MetroPlus for the custom-molded back braces, which were never requested or provided to the Medicaid recipients. Altogether, she pocketed more than $4 million from the scheme. Montgomery also admitted to hiding the criminal proceeds using shell companies, including LCM Livery, through which she funneled the stolen money to purchase two homes in the Bronx.

In conjunction with the criminal case, the Office of the Attorney General (OAG) also filed a civil complaint against Montgomery and her companies. The complaint — which asserts violations of New York’s False Claims Act, Section 145-b of New York’s Social Services Law, Executive Law Sections 63(12) and 63-c, and other causes of action — seeks to additionally recover millions of dollars in Medicaid money obtained by these defendants as a result of their fraudulent conduct. That suit is still pending in court.

Medical Biller Guilty

Kelly Addam Gersting, 51, of Las Vegas, was sentenced in a Medicaid fraud case involving billing for services that were not provided to Medicaid recipients.

Gersting was sentenced for a Gross Misdemeanor offense of Intentional Failure to Maintain Adequate Records by District Court Judge Christy Craig. Judge Craig sentenced Gersting to 364 days in jail, suspended, and placed him on probation for one year. As part of the sentence, Gersting was also ordered to pay $42,510 in restitution. The billing occurred between April 2015 and April 2019.

The investigation began after the MFCU received a complaint from employees of a Rehabilitative Mental Health (“RMH”) services Medicaid provider that the company was billing for services while the provider was traveling out of Las Vegas. The investigation revealed that defendant, as the biller of the company, submitted claims for RMH services allegedly provided by Ingrid Sanchez (“Sanchez”) during times when Sanchez was traveling out of the United States and could not have provided the RMH services to the Medicaid recipients in Nevada.

Woman Sentenced for Medicaid Fraud by Oklahoma County Jury

Janice Wrenn was found guilty of Medicaid Fraud by an Oklahoma County jury in December 2021. The jury verdict assessed a total of $281,273.00 in fines. At the sentencing hearing the Court set financial restitution for the convictions at $393,934.86.

Wren, a former Oklahoma woman who operated behavioral health facilities in Oklahoma City and Edmond was sentenced for Medicaid Fraud. The jury found Wrenn, formerly known as Janice Briggs, guilty of six counts of Medicaid Fraud.

The investigation started after the Oklahoma Attorney General’s Office Medicaid Fraud Control Unit (MFCU) received an allegation that Briggs Family & Youth Association submitted false claims to Medicaid. The investigation revealed that in addition to the false claims initially reported, Wrenn continued to submit claims after termination of contracts by the Oklahoma Health Care Authority (OHCA), which administers the Oklahoma Medicaid program.

Not for Profit Executive Pleads Guilty for Stealing from Medicaid

Shirley L. Goddard — 75, of Dewitt, New York — Pleaded guilty of embezzling more than $650,000 from Humanitarian Organization for Multicultural Experiences, Inc. (H.O.M.E.), where she served as executive director for nearly 30 years. H.O.M.E. — a Syracuse-based not-for-profit organization started by Goddard and her husband, Tyrone M. Goddard, in 1992 — received funding from Medicaid to provide outpatient, community-based services to children and adults who are developmentally disabled. In submitting her plea today, Goddard admitted to stealing the funds from H.O.M.E. from January 2014 to September 2018, and has agreed to repay the stolen amount in restitution to the Office of the Attorney General’s (OAG) Medicaid Fraud Control Unit (MFCU). The funds will be returned to H.O.M.E. to replenish the amount that Goddard stole. 

On March 18, 2022, before Onondaga County Court Judge Thomas J. Miller, Goddard pled not guilty to the felony complaint, waived presentation to a grand jury, and entered a guilty plea to a superior court information, in which she admitted to embezzling $650,809.32 from H.O.M.E. during the period of January 1, 2014 to on or about September 30, 2018. Goddard is scheduled to be sentenced on May 13, 2022.

In addition to the criminal prosecution conducted by MFCU, OAG’s Charities Bureau filed a civil lawsuit against Shirley and Tyrone Goddard that seeks the recovery of the funds Ms. Goddard has admitted to stealing, as well as other misappropriated charitable assets and seeks a permanent bar prohibiting the Goddards from holding any fiduciary role in a charitable or nonprofit organization operating in New York.

Medicaid Services Provider Owner Convicted in Nevada

Leshay Danail Harris, 36, of Las Vegas, was sentenced in a case involving failure to maintain records for services billed to Nevada Medicaid. 

Harris, the owner of Foundation Stone Family Services, Inc. (Foundation Stone), was sentenced for a Gross Misdemeanor offense of Intentional Failure to Maintain Adequate Records by District Court Judge Kathleen E. Delaney. Judge Delaney sentenced Harris to 364 days in jail, suspended, and placed her on probation for one year. As part of the sentence, Harris was also ordered to pay $30,709 in restitution. The billing occurred between January 2018 and May 2018.

“My office will continue to enforce regulations for Medicaid providers to be transparent and accurate with all their billing and records requirements.” said AG Ford. “Owners remain ultimately responsible when receiving taxpayer funds for ensuring their companies abide with all Medicaid regulations.”  

The investigation began after the MFCU received a complaint that a rehabilitative mental health services Medicaid provider was billing for services that were not provided.  During that investigation, the MFCU discovered that another Medicaid services provider, Foundation Stone, was also billing for services that may not have been provided. The investigation revealed that Foundation Stone billed service hours under the name of a provider purportedly engaged by Foundation Stone during the above-referenced period. The investigation further revealed the provider did not provide any services to many of the Medicaid recipients for whom Foundation Stone billed Medicaid for services by the provider. In addition, Harris failed to maintain the required documentation supporting such purported services.

Guilty of Provider Fraud

Barry Robb Redford, 53, of Pocatello, Idaho pleaded guilty in December. On February 28, 2022, Sixth District Judge Robert Naftz issued a unified sentence of four years. The judge then suspended the sentence and ordered Redford to serve four years probation, 200 hours of community service and pay $363 in restitution, a $750 fine, and court costs.

The case stems from Redford’s actions as owner of Redford Counseling and Family Services. Between January 2016 to April 2016, Redford fraudulently billed Idaho Medicaid for services he did not provide.

Man Bites Dog Story: GEICO Sues Fraud Perpetrators

In Government Employees Insurance Company, Geico Indemnity Company, Geico General Insurance Company & Geico Casualty Company v. Elmwood Park Medical Group, P.C., Molnar Medical Services, P.C. & Kristappa Sangavaram, No. 1:21-cv-00617-FB-RER, United States District Court, E.D. New York (March 14, 2022) Magistrate Judge Ramon E. Reyes, Jr. issued a Report and Recommendation (“R&R”) recommending that default judgment against Defendants Elmwood Park Medical Group P.C., Molnar Medical Services P.C., and Kristappa Sangavaram (“Defendants”) be granted in part. Plaintiffs alleged that Defendants engaged in a complex insurance fraud scheme in violation of the federal Racketeer Influenced and Corrupt Organizations Act (“RICO”).

Plaintiffs also alleged counts for common law fraud and unjust enrichment and sought a judgment under the Declaratory Judgment Act, declaring that Defendants have no right to receive payment for pending bills submitted to GEICO in the course of the fraudulent scheme. Plaintiffs seek default on their claims of common law fraud and unjust enrichment, as well as a declaratory judgment.

Magistrate Judge Ramos recommends that the motion be granted in part, and

1)       judgment be entered against Dr. Sangavaram and Elmwood Park, jointly and severally, in the amount of $842,422.90 in compensatory damages, $161, 638.26 in pre-judgment interest, and $206.92 per diem from February 23, 2022 until final entry of judgment;

2)       judgment be entered against Dr. Sangavaram and Molnar Medical, jointly and severally, in the amount of $179,373.37 in compensatory damages, $33, 972.52 in pre-judgment interest, and $43.64 per diem from February 23, 2022 until final entry of judgment; and

3)       a declaratory judgment be entered that Plaintiffs are not obligated to pay outstanding claims submitted by Defendants.

Magistrate Judge Ramos’s R&R stated that failure to object within fourteen days of the date of the R&R waives the right to appeal. No. objections were filed.

If clear notice has been given of the consequences of failing to object and there are no objections, the Court may adopt the R&R without de novo review. See Smith v. Campbell, 782 F.3d 93, 102 (2d Cir. 2015) (“Where parties receive clear notice of the consequences, failure to timely object to a magistrate’s report and recommendation operates as a waiver of further judicial review of the magistrate’s decision.”) (internal citations omitted).

The Court adopted the R&R without de novo review and directs the Clerk to enter judgment in accordance with the R&R.

ZIFL OPINION

Because of the inadequacy of state fraud divisions, fraud bureaus, district attorneys and states attorneys to prosecute insurance it is incumbent on the insurance industry to emulate GEICO by suing fraud perpetrators – like the health care providers in this case – which will work to deter the crime on insurance fraud.

ZIFL hopes that GEICO obtains a write of execution from the court and makes every effort to collect on the judgment.

Settlement of Fraud Suit Does Not Allow Doc to Sue Insurers

SLAPP Motion Appropriate When Fraud Perpetrators Sue Insurers and Their Lawyers

Similar to the GEICO case above, nine insurers sued Ajay Mohabeer for fraudulently billing them for medical treatment never provided nor provided in the amounts charged. The insurers sued, lost a partial summary judgment, and rather than go on to trial on other causes of fraud, settled the suit with Dr. Mohabeer. However, the insurers lost their courage and settled with Mohabeer before trial. Unhappy with the settlement Dr. Mohabeer sued the insurers and their lawyers for wrongful use of civil proceedings and damages (called malicious prosecution in other jurisdictions) in Ajay Mohabeer v. Farmers Insurance Exchange, a corporation; et al , 318 Or.App. 313, A172057, Court of Appeals of Oregon (March 16, 2022) where he sued nine insurance company defendants (collectively Farmers) and Farmers’ attorneys, for wrongful use of civil proceedings, alleging that defendants filed insurance fraud claims against plaintiff in federal court, which were ultimately settled. Mohabeer claimed the insurers sued him with malicious intent and without probable cause.

THE LITIGATION

The insurers and lawyers filed a special motion to strike the claims under Oregon’s Anti-Strategic Lawsuits Against Public Participation (anti-SLAPP) statute, contending that plaintiffs claims seek damages for conduct that is protected under ORS 31.150(2), and that plaintiff could not present substantial evidence that he would prevail on his claim. Defendants appealed from the trial court’s limited judgment denying the motion. The special motion to strike is Oregon Statute, ORS 31.150(1) requires four categories of claims subject to a special motion to strike:

1. Any oral statement made, or written statement or other document submitted, in a legislative, executive or judicial proceeding or other proceeding authorized by law;

2. Any oral statement made, or written statement or other document submitted, in connection with an issue under consideration or review by a legislative, executive or judicial body or other proceeding authorized by law;

3. Any oral statement made, or written statement or other document presented, in a place open to the public or a public forum in connection with an issue of public interest; or

4. Any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest.

FACTS

A defendant making a special motion to strike has the initial burden to make a prima facie showing that the plaintiffs claim is of the type described in the statute. If the defendant meets that burden, the burden shifts to the plaintiff in the action to establish that there is a probability that the plaintiff will prevail on the claim by presenting substantial evidence to support a prima facie case.

Plaintiff is a licensed medical doctor who practiced medicine in association with First Choice Chiropractic clinics. In 2013, defendants filed several claims in federal court naming as defendants First Choice Chiropractic clinics, plaintiff, and several other individuals, based on allegations that the clinics and individual defendants had committed insurance fraud by making “false reports of alleged symptoms and exaggerated findings designed to make it appear that the patient either had or continued to have injuries/ symptoms which did not actually exist.” Plaintiff and the other named defendants sought summary judgment in the underlying action, and the federal district court granted the motion on some claims but denied it in part as to several of the claims, finding that there was evidence of conduct by plaintiff and the other named defendants that gave rise to genuine issues of fact on those claims. Farmers and plaintiff subsequently settled Farmers’ remaining claims against plaintiff in the underlying action and stipulated that plaintiff would be considered the prevailing party.

Plaintiff then brought this action for wrongful use of civil proceedings, alleging that Farmers named plaintiff as a defendant in the underlying action without a basis in fact so that Farmers could allege racketeering claims, for which Farmers would be entitled to treble damages and attorney fees. Plaintiff alleged that he was named as a defendant without probable cause and with malicious intent. Defendants filed their special motions to strike under ORS 31.150 and, after a hearing, the trial court determined that plaintiff had presented substantial evidence to support a prima facie case on his claim. The court thus denied the motions by limited judgment.

The allegations of plaintiffs claim are based solely on written statements and documents provided to the federal court in the context of the underlying action. The only dispute on appeal concerns whether plaintiff has met his burden to present prima facie evidence as to each element of his claim of wrongful use of civil proceedings.

ANALYSIS

One element of the claim of wrongful use of civil proceedings is an absence of probable cause to prosecute the underlying action. Probable cause means that the person initiating the underlying action “reasonably believes” that there is a good chance of prevailing, viz., the person “has that subjective belief and that belief is objectively reasonable.” Plaintiff contended that a probable cause determination is premature, because the existence of prima facie evidence of a lack of probable cause is a question for the factfinder that necessitates additional discovery. In the context of the special motion to strike, however, the existence of prima facie proof of the elements of the claim being challenged by the motion is something that the court determines as a matter of law, based on the pleadings and supporting and opposing affidavits stating the facts upon which the liability or defense is based.

Defendants contended that the summary judgment ruling of the federal district court in the underlying action conclusively establishes that Farmers had probable cause to bring the underlying action. In denying plaintiffs and the other named defendants’ motions for summary judgment against the claims in the underlying action, the federal district court concluded that Farmers had demonstrated genuine issues of material fact as to whether plaintiff:

• made material misrepresentations, either knowingly or recklessly, by signing off on falsified chart notes;

• engaged in a pattern of racketeering by committing indictable acts through wire and mail fraud;

• engaged in a conspiracy to commit racketeering; and

• was unjustly enriched by fraudulent claims made to Farmers by falsified chart notes.

The court agreed with defendants’ argument that that is evidence that the claims brought by defendants in the underlying action were objectively reasonable and based on probable cause. Independent of the federal district court’s summary judgment ruling in the underlying action, there is ample evidence in the record that defendants had probable cause to name plaintiff as a defendant in the underlying action, including affidavits of former clinic employees, who described plaintiffs participation in a scheme to over-treat patients and over-bill insurance. Plaintiff disputes that evidence but has not rebutted it with evidence to support his position.

The Court of Appeals of Oregon concluded that the trial court erred in denying the special motion to strike and therefore it reversed the limited judgment and remanded the case to the trial court for entry of a judgment dismissing plaintiffs claim because the plaintiff has not met his burden to present prima facie evidence of a lack of probable cause, and that the trial court erred as a matter of law in denying defendants’ special motion to strike.

ZIFL OPINION

Farmers and the other insurers defendant should be honored for proactively working to defeat a fraudulent claim. By not taking the case to trial after losing a partial summary judgment motion and stipulating that the case was resolved in the favor of the plaintiff they invited his suit. The Oregon Court of Appeal looked at the evidence and found that the insurers had probably cause to sue Dr. Mohabeer and dismissed the suit. The lesson learned by the insurers was that they should have taken Dr. Mohabeer to trial on the causes that they could have proved were fraudulent. Settlement is not appropriate when evidence of fraud exists.

Other Insurance Fraud Convictions

Murder for Hire Life Insurance Fraud

Maria Moore, 53, and Marvel Salvant, 49, killed Dominic Sarkar, 56, in the Oct. 8, 2018 shooting at Sarkar’s Fremont home. Moore was listed as Sarkar’s domestic partner and acquired two life insurance policies, for $500,000 and $300,000, with plans to pocket the money after his death, prosecutors argued at trial.

An Alameda County jury convicted Moore and Salvant of murdering a Fremont resident over $800,000 in life insurance, a crime that the hitman received only $500 for, prosecutors announced.

Salvant was linked to the crime because his car was seen parking near Sarkar’s home shortly before the crime and leaving a short time later. Salvant’s attorney argued at trial that authorities focused on Salvant when there was stronger evidence another man was responsible.

Both were convicted of first-degree murder with special circumstances and face a life sentence. They have been scheduled for sentencing on March 8, 2022.

Insurance Fraud Excessive in Korea

The Korea Insurance Research Institute (KIRI) released a report saying false health insurance claims reached 111.5 billion won in 2019 among claims by patients with Grade 12/14 mild injuries.

Inflated health insurance claims by patients who had only minor injuries in traffic accidents recorded 650 billion won ($532 million) in 2019, government data showed.
In other words, 64.6 percent of the car insurance claims by patients with mild injuries were caused by excessive treatment in 2019. If the 646.8 billion won inflated insurance claims are divided by per-capita health insurance premiums, it translates into 31,200 won per person.

Read the full article from the Korea Biomedical Review at http://www.koreabiomed.com/news/articleView.html?idxno=13340

Insurance Fraud is a Violent Crime: Life in Prison for Murder for Life Insurance Money

Billy Ray Turner was convicted by a jury on March 20, 2022 for the murder of former NBA player Lorenzen Wright, who was found shot dead in a field nearly 12 years ago in his hometown of Memphis.

The 12-person jury deliberated for about two hours before it found Turner guilty of first-degree murder, attempted murder and conspiracy in the death of Wright, who played 13 seasons in the NBA before he retired after the 2008-09 campaign. Judge Lee Coffee sentenced Turner, 51, to life in prison for the murder conviction. He will be sentenced for the other charges at a later date.

Coffee called Wright “a sacred son” of Memphis and told his mother, Deborah Marion, that the trial might not bring her closure but would “celebrate the good” about her son. Outside the courtroom, Marion told reporters she was elated with the verdict. She said she would visit her son’s grave Monday night.

Turner had already pleaded guilty to possessing a weapon as a convicted felon after he was found with two guns when he was arrested in Wright’s killing in 2017. Turner is serving a 16-year prison sentence on the separate gun charge.

Prosecutors alleged that Wright’s ex-wife, Sherra Wright, masterminded a plan to kill her ex-husband and recruited Turner and her cousin, Jimmie Martin, to help her.  Sherra Wright entered a surprise guilty plea to facilitation of murder in July 2019 and was sentenced to 30 years in prison.

Turner is a landscaper who knew Sherra Wright from church and, according to prosecutors, had a secret romantic relationship with her. At the time of Wright’s slaying, Martin was facing charges of killing his girlfriend, and he said his cousin helped pay part of his legal fees. Martin was convicted and is currently serving prison time in that case. He has received immunity from prosecution in the Wright case.

Martin testified that Sherra Wright recruited him and Turner to kill Lorenzen Wright. Martin testified that he and Turner met with Sherra Wright to plan the killing and went to Lorenzen Wright’s condominium in Atlanta to shoot him, with an understanding that he would get paid.

Armed with handguns, Turner and Martin went to Wright’s condo in Atlanta, entered through a window and found someone sleeping on the couch in the living room – but it was not Lorenzen Wright, Martin testified. Turner and Martin returned home without killing anyone.

The jury heard a 911 call made by Lorenzen Wright that captured the pop-pop-pop sound of multiple gunshots. Martin also said Turner and Wright got rid of evidence from the shooting scene and he went with Turner to dispose of the weapon by dumping it in a north Mississippi lake. Martin said he told detectives in 2012 where the gun was located. It was later found by FBI divers.

A motive for the slaying was not clear, though Hagerman said the killers were driven by jealousy and greed. Sherra Wright received $1 million from her ex-husband’s life insurance policy and settled a court dispute in 2014 over how she spent the insurance money meant to benefit their six children.

Marion, the slain player’s mother, said she’s convinced the insurance policy was Sherra Wright’s motivation.

Guilty of Helping Honestly Named Criminal Insurer “Fraud Guarantee”

Lev Parnas, will plead guilty to a conspiracy count concerning his work at a fraud insurance. Ukraine-born Parnas on Thursday asked U.S. District Judge Paul Oetken in Manhattan to schedule a change-of-plea hearing, after pleading not guilty in November 2020 to wire fraud conspiracy.

Prosecutors accused Parnas and co-defendant David Correia of conning people into investing more than $2 million in their Florida start-up Fraud Guarantee, but withdrawing much of it for personal use including political donations.

Parnas was convicted October 22, 2021 after being accused of using money tied to Russian businessman Andrey Muraviev to gain favor of candidates in the 2018 U.S. midterm elections, with an eye toward building a legal cannabis business.

Oetken on Monday denied requests by Parnas and co-defendant Andrey Kukushkin to set aside their convictions.

The conspiracy charge had been severed from that case. Any sentence would cover Parnas’ conviction and guilty plea.

Parnas traveled to Ukraine to seek damaging information about Democrat Joe Biden, who later became president, and his son Hunter.

Oetken said Fraud Guarantee had “real victims” and “the irony of the business’ name, Fraud Guarantee, is hard to ignore.”

Zurich Wins Court Case in U.K. As Defendant Pleads Guilty to Fraudulent Motor Claim

See full story at https://www.insurancetimes.co.uk/news/zurich-wins-court-case-as-defendant-pleads-guilty-to-fraudulent-motor-claim/1440571.article?utm_source=adestra&utm_term=Read%20more&utm_medium=email&utm_campaign=25592

Introduction

After deliberately causing damage to his car, the fraudster is facing a ‘hefty fine, community service and criminal record’, says head of claims fraud.

A man from London has been jailed for trying to defraud two insurance companies by using a number of aliases.

UK Serial Fraudster Convicted & Sentenced to Only Six Months in Prison

Jubair Choudhury, 36, of De Vere Gardens, Cranbrook, Ilford, U.K. was investigated by the City of London Police’s Insurance Fraud Enforcement Department (IFED) after Hastings Direct and 1ST CENTRAL suspected that claims he had submitted were fraudulent.

Choudhury was sentenced to six months imprisonment on February 142022 at Inner London Crown Court. He previously pleaded guilty to four counts of fraud by false representation in August 2021.

Detective Sergeant Jamie Kirk, from the City of London Police’s Insurance Fraud Enforcement Department (IFED), said:

“Choudhury really has carved a name for himself as a serial fraudster. He was sentenced for similar offences back in 2017, however he clearly did not learn his lesson. It is always frustrating to see a criminal back in court, but hopefully a stint in prison will finally teach Choudhury that no matter how many names you hide behind, you will be caught out in the end.”

Choudhury took out a car insurance policy with Hastings Direct in August 2017, using the name ‘Mario Valentino’. He stated on his application that he had no criminal convictions and nine years’ no claims bonus.

Hastings Direct received a claim notification form in October 2017 from a third party reporting a collision involving Choudhury a few days prior. The insurer reached out to Choudhury as they had suspicions that the claim may have been fraudulent, but could not reach him on multiple occasions. 

Choudhury contacted Hastings Direct around two weeks later and denied being involved in the reported collision. However, he said he had been involved in another collision and had settled this with the third party himself.

Choudhury’s silver Audi was examined by a vehicle assessor the following month. The assessment concluded that the vehicle could not have been involved in the collision reported by the third party in October 2017, as the minor damage to the vehicle was not consistent with the report.

An investigator from Hastings Direct visited Choudhury to take a statement in January 2018 regarding the seemingly bogus third-party report. During this visit, Choudhury flagged an unrelated incident, claiming that his car was damaged whilst parked outside a property overnight in September 2017.

Choudhury alleged that a note was left on his car by a witness named ‘Jamail Caan’, who had seen the vehicle hit his car and then drive off. Choudhury then reported the collision to the police and discovered that registration of the car was linked to a policy with 1ST CENTRAL.

The claim with 1ST CENTRAL raised concerns for Hastings Direct, due to discrepancies between Choudhury’s story and their records.

Choudhury contacted 1ST CENTRAL to report the collision. He described the damage to the vehicle, stating that “the whole of the front is completely off the vehicle and left on the roadside”.

1ST CENTRAL made multiple attempts to contact the policyholder without success. While he liaised with the insurer and waited for the outcome, Choudhury moved the car into storage and had work completed on the vehicle by an independent body repair shop. Choudhury provided 1ST CENTRAL with an invoice for repair and storage from a company in Essex, totalling £2,250. This invoice was in the name of ‘Carlos Doir’.

Choudhury told 1ST CENTRAL that his car was in storage until 20th December, which did not correspond with the record Hastings Direct had of one of their vehicle assessors examining his car on a London road on 7th December.

1ST CENTRAL questioned the validity of the claim Choudhury had submitted to them, leading the case being forwarded onto their investigation team. Enquiries revealed that ‘Mario Valentino’ – the name Choudhury had submitted this claim under – had the same date of birth as ‘Carlos Doir’ and ‘Jamail Caan’, the supposed witness to the collision.

The 1ST CENTRAL policyholder was eventually reached. He confirmed that he had not been involved in a collision and had only been made aware of the alleged accident when contacted by the insurer.

IFED made enquires with the Driver and Vehicle Licensing Agency (DVLA), which uncovered a series of names changes on Choudhury’s driving license, including the names Mario Valentino, Carlos Doir and Jamail Caan.

Further checks on the Police National Computer (PNC) linked Choudhury to 17 aliases, as well previous convictions in 2017 for similar offences in failing to disclose information to insurers with a view to gain. Choudhury was also found to have a number of convictions for driving whilst disqualified and other motoring offences.

When interviewed by officers, Choudhury initially answered no comment to all questions, but later attempted to give an unclear explanation.

Matthew Stevens, Counter Fraud Director at Hastings Direct, said:  

“Working closely with the City of London Police and other insurers is crucial in bringing fraudsters to justice, so that we can protect all innocent road users.  I am delighted with the outcome in this case. Hastings Direct will continue to invest in leading edge technology to ensure we are at the forefront in the battle against fraud.”

Paul Priestley, Counter Fraud Director at 1ST CENTRAL, added:

” Fraud isn’t a victimless crime. We know it can have a serious impact on honest policyholders. That’s why we’ve invested significantly in our counter fraud capabilities over the last couple of years. We were pleased to help the authorities in catching this serial fraudster and will continue to do everything we can to protect our customers.”

Zalma on Insurance Blog Posting

• True Crime of Insurance Fraud Video Number 45 March 30, 2022

• An Unhappy Insured is Not Evidence of Bad Faith March 30, 2022

• True Crime of Insurance Fraud Video Number 44 March 29, 2022

• Settlement of Fraud Suit Does Not Allow Doc to Sue Insurers March 29, 2022

• True Crime of Insurance Fraud Video Number 43 March 28, 2022

• An Adjuster is not a Party to a Contract of Insurance March 28, 2022

• There are now 396 Insurance Claims Law Videos March 27, 2022

• True Crime of Insurance Fraud Video Number 42 March 25, 2022

• When Liability Insurance is Exhausted Arbitration Agreement Controls Duty to Arbitrate March 25, 2022

• True Crime of Insurance Fraud Video Number 41 March 24, 2022

• Insurance Contract Dispute Is Not Bad Faith March 24, 2022

• New Second Edition of Barry Zalma’s Insurance Fraud Book Now Available March 23, 2022

• True Crime of Insurance Fraud Number 40 March 23, 2022

• It’s Not Nice to Claim One Fact to One Judge and Another to the Next March 23, 2022

• One Way Off Welfare March 22, 2022

• Violating Term of Graduated License Eliminates Auto Liability Coverage March 22, 2022

• Free Insurance Law & True Crime of Insurance Fraud Videos Available March 21, 2022

• Failure to Acquire Required Insurance Breaches Contract March 21, 2022

• Don’t Take “The Fifth” When Your Insurer Asks For An Examination Under Oath March 18, 2022

True Crime Stories of Insurance Fraud

There are now available at https://rumble.com/zalma more than 45 Video True Crime Stories of insurance fraud. The latest is called “How Insurance Fraud Destroyed a Family

Barry Zalma, Esq., CFE presents videos so you can learn how insurance fraud is perpetrated and what is necessary to deter or defeat insurance fraud. This Video Blog of True Crime Stories of Insurance Fraud with the names and places changed to protect the guilty are all based upon investigations conducted by me and fictionalized to create a learning environment for claims personnel, SIU investigators, insurers, police, and lawyers better understand insurance fraud and weapons that can be used to deter or defeat a fraudulent insurance claim. You can see all the True Crime Stories of Insurance Fraud and insurance law with a total of more than 398 videos at https://rumble.com/zalma.

Become a Practioner of Excellence in Claims Handling

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Barry Zalma, Esq., CFE

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Over the last 54 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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