Zalma’s Insurance Fraud Letter February 15, 2022

The Essential Resource for The Insurance Fraud Professional

Barry Zalma

Feb 15, 2022

Quote of the Issue

“Do Not Pray for An Easy Life; Pray for The Strength to Endure a Difficult One.”

Bruce Lee

Go Directly to Jail, Do Not Pass Go

Chutzpah: Convicted of Insurance Fraud Appeals to Avoid Going to Jail

Tarek Abou-Khatwa appealed his conviction of a complex, multi-year insurance fraud scheme. He previously asked the court to delay the start of his incarceration pending the outcome of that appeal. On January 31, 2022, the court denied his request, explaining that Defendant’s appeal did not present a “close question” as to each count on which he was sentenced to prison.

In United States of America v. Tarek Abou-Khatwa, Criminal No. 18-cr-67 (TSC), United States District Court, District of Columbia (February 4, 2022) Tarek’s multiple appeals in an attempt to avoid was again brought to the USDC.

Defendant filed an “Emergency Motion” with the USDC stating his intent to lodge a second appeal, this time challenging the court’s January 31 Order, and he requested that his self-surrender date be postponed pending the outcome of that new appeal.

Defendant’s conviction is presumed valid and he bears the burden of rebutting that presumption. In his previous motion, Defendant failed to rebut that presumption because he did not present a “substantial question of law” as to each count of his conviction for which he faces imprisonment. Accordingly, the court held Defendant’s self-surrender date in place.

Defendant, undeterred by his losses in the USDC, now argues that his self-surrender date should be delayed while he appeals that decision. He contended that his current self-surrender date is not “sufficient to allow time for briefing before both the district court and the court of appeals, as the parties originally intended.” He claims that additional time is necessary for “a motion to the D.C. Circuit appealing this Court’s order denying release pending appeal [to be] decided by that Court.” He also argues that refusal to grant further delay would “frustrat[e] his appeal rights under Section 3145(c) and Rule 9(b).”

The court disagreed that emergency action is necessary to avoid “frustrating his appeal rights under Section 3145(c) and Rule 9(b).”

ANALYSIS

First, 18 U.S.C. § 3145(c) pertains to appeals of detention orders, not release from custody, and so it is inapplicable. Second, nothing in the court’s January 31, 2022, Order restricts Defendant’s ability to seek relief from the Court of Appeals. The court, aware that the timeline for Defendant to both appeal this court’s January 31 Order and receive a decision on that appeal before his February 10 self-surrender date, is truncated. However, Defendant-not the court-bears responsibility for that accelerated schedule.

Actually, Defendant notified the court that he was appealing his conviction on June 10, 2021 and filed his opening appellate brief on November 1, 2021. Defendant could have moved to delay his surrender date pending appeal at that point, but instead waited until December 6, 2021. When Defendant did eventually file his motion, he requested only a one-month delay, from January 10 to February 10, 2022, which the court granted.

And third, rather than immediately appeal the court’s January 31 Order, Defendant waited two days to again move for relief and then proposed an additional two-day briefi

Zifl 2 15 2022

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ng schedule. In short, Defendant’s concerns about his ability to obtain relief from the Circuit are a product of his own doing.

Finally, in a footnote in his reply brief, Defendant requests that if the court denies the present motion that he be permitted “a short postponement, e.g., two weeks, so that he may appeal the Court’s disposition of the instant motion.” In other words, Defendant would like three appeal tracks: one attacking the merits of his conviction, which is now fully briefed and awaiting disposition from the Circuit; a second challenging the court’s January 31 Order denying his request to delay his sentence pending the first appeal, which Defendant reports “is being filed today,” and a third challenging this decision to deny his request to delay his sentence pending resolution of the second appeal.

Accordingly, the court denied Defendant’s latest request to delay the start of his incarceration.

ZIFL OPINION

Tarek’s fraud must have been very successful since he has the funds to have lawyers bring multiple motions and appeals to avoid incarceration. The actions are a clear explication of the concept of “chutzpah” or unmitigated gall. His efforts continue to fail and it is time that he reports to federal prison and begin his sentence after conviction for fraud. The USDOJ should consider determining what other crimes he was involved in that allows him funds to support the multiple motions and appeals.

Wisdom

“If they don’t give you a seat at the table, bring a folding chair.” – Shirley Chisholm

“The beauty of doing nothing is that you can do it perfectly. Only when you do something is it almost impossible to do it without mistakes. Therefore, people who are contributing nothing to society, except their constant criticisms, can feel both intellectually and morally superior.” – Thomas Sowell

“When you know what you are willing to die for, then you will know what to live for.” — Jewish saying

“It was an age of miracles, it was an age of art, it was an age of excess, and it was an age of satire.” — F. Scott Fitzgerald

“I myself know nothing, except just a little, enough to extract an argument from another man who is wise and to receive it fairly.” – Socrates

“When action grows unprofitable, gather information; when information grows unprofitable, sleep.” — Ursula K. Le Guin

“Education is the key to unlock the golden door of freedom.” – George Washington Carver

“If you are depressed you are living in the past, if you are anxious you are living in the future, if you are at peace, you are living in the present.” — Lao Tzu

“In the depths of Winter, I finally learned that within me there lay an invincible summer.” – Albert Camus

“No need to hurry. No need to sparkle. No need to be anybody but oneself.” – Virginia Woolf

“Patience is a necessary ingredient of genius.” – Benjamin Disraeli

Fraud by Insurance Company Officials

Insurance fraud is not a crime limited to people defrauding insurers. Sometimes, insurers and their officers commit fraud in many ways, including, but not limited to:

v    Submission of falsified financial statements.
v    Misuse of company funds.
v    Issuance of unauthorized insurance policies.
v    Insurance plans not authorized by the state Departments of Insurance.
v    Individuals not licensed to do the business of insurance.
v    Fraudulent group/individual health plans.

Some examples of fraud by insurers claimed under homeowners policies include:

v    Insisting that the insured allow the insurer to generate the loss inventory after a covered loss.
v    Issuing policies with a declaration page showing policy limits that the insurer knows is higher than the actual cash value or replacement cost of the property, the risk of loss of which is insured, to take premium for a greater risk than that actually taken.
v    Using economic coercion to force the claimant to use their preferred repair vendor.
v    Undercutting market rates to lure employers to acquire Workers’ Compensation insurance while failing to properly maintain sufficient funds in reserve to cover claims.
v   Use of an unqualified or dishonest Medical Examiner to avoid payment of claims.
v   Use of unethical defense attorneys to avoid payments of claims.
v   Use of unethical private investigators.
v   Use of Special Investigative Unit investigators whose only purpose is to deny claims rather than in an effort to avoid fraud.

In In re Insurance Brokerage Antitrust Litigation, 618 F.3d 300 (3rd Cir., 2010) understand that the allegations that gave rise to the litigation raised serious questions and caused the insurance industry enormous amounts of money to defend themselves.

Section 1 of the Sherman Act provides: “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.” 15 U.S.C. § 1. In addition to demonstrating the existence of a “conspiracy,” or agreement, “the plaintiff must show that the conspiracy to which the defendant was a party imposed an unreasonable restraint on trade.”

As the District Court recognized, plaintiffs’ “broker-centered conspiracies” are alleged as hub-and-spoke conspiracies, with the broker as the hub and its insurer-partners as the spokes. This type of conspiracy has a long history in antitrust jurisprudence.

Overlaying the broker-centered conspiracies, plaintiffs aver, was a “global conspiracy.” In this alleged scheme, the defendant brokers, “with the complicity of the Defendant Insurers,” agreed “to conceal from the general public and other brokers [i.e., non-conspiring brokers]” the existence of the broker-centered conspiracies and the details of the contingent commission agreements. Plaintiffs contend that this “agreement not to disclose the Contingent Commission agreements and resulting profits was a naked horizontal restraint of informational output that directly affected the price of insurance.” The District Court concluded that the complaints’ factual allegations fail to plausibly imply horizontal non-disclosure agreements among the defendant brokers or the defendant insurers.

The court found that it is clear that at least the following activities are the business of insurance, either because they pertain to risk-spreading or to the contract between the insurer and the insured:

1.                   preparing and filing a rating-schedule, either on behalf of an individual company or jointly through a rating bureau;
2.                   deciding upon rating classification differences between individual policies and group marketing plans, either individually or jointly through a rating bureau;
3.                   authorizing agents to solicit individual or group policies;
4.                   accepting or rejecting coverages tendered by brokers.

Because the McCarran-Ferguson Act does not bar plaintiffs’ claims the court’s analysis is dispositive. Given the long path our discussion has taken, a brief synopsis of that analysis is in order. Courts confronted with a motion to dismiss must assess whether the complaint contains “enough factual matter (taken as true) to suggest that an agreement was made. The bid-rigging allegations supply the requisite “further circumstance.” Because they plausibly suggest an unlawful horizontal conspiracy not to compete for incumbent business, plaintiffs have adequately met the requirement for setting forth a claim against those defendants in the asserted commercial conspiracy who are alleged to have participated in bid rigging. This agreement to divide the market, if proven, would be a naked restraint of trade subject to per se condemnation.

The Third Circuit concluded:

For the forgoing reasons, we will vacate the dismissal of the Sherman Act claims with respect to defendants alleged to have engaged in bid rigging in the Marsh-centered commercial conspiracy; the dismissal of the RICO claims based on the alleged Marsh-centered commercial enterprise, with respect to those same defendants; the dismissal of the RICO claims based on the alleged CIAB enterprise, with respect to the defendant brokers; and the dismissal of the state-law claims. We will affirm the District Court’s judgment in all other respects and remand for further proceedings consistent with this opinion.

[This article was adapted from my book, Insurance Fraud Volume II – Volume One available as a Kindle book and a paperback. Volume Two Available as a Kindle book and a paperback]

ClaimSchool, Inc. – Insurance Education

Insurance Education from Barry Zalma

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Mr. Zalma’s presentations are practical, thought-provoking, entertaining and will fit easily into any budget.

Enthusiastically committed to professionalism in insurance and insurance claims Mr. Zalma positively influences other insurance professionals through the spoken and written word.

Mr. Zalma specializes in clarifying the importance of insurance in a modern society and in making insurance understandable. He also provides everything needed by the insurance claims professional to complete the thorough investigation of a property, casualty or liability claim efficiently, equitably, empathetically and in good faith.

How Will You or Your Group or Organization Benefit from Working with Barry Zalma?

You can expect live or video presentations supplemented with texts that are:

Clear and understandable presentations that involve the both youngest and oldest member of your organization.
Presentations that entice the most experienced person in your organization who thinks he or she has nothing to learn.
Enhanced communications between claims and legal service providers.
Methods to make claims operations more cost effective.
Improved recognition of the indicators or “red flags of fraud.”
Better understanding of how to deal with people presenting claims
Improved interviewing techniques.
Ability to use methods that achieve a quantifiable reduction in claims expenses and indemnity payments while leaving the insured totally satisfied.

Live Training Available

Barry Zalma Presents What Your Insurance Organization Needs.

He positively influences other insurance professionals through the spoken and written word. He specializes in clarifying the importance of insurance in a modern society and in making insurance understandable.

The Excellence in Claims Handling Program Will Cover:

How to Read and Understand an Insurance Policy;
The loss notice.
The first contact with the insured presenting a claim.
The first contact with a third party claimant presenting a claim against an insured.
Underwriting for the claims professional.
The recorded statement.
Locating and taking recorded statement of independent witnesses.
Locating and obtaining information from governmental entities.
Preparing an agreed scope of loss with an insured or the insured’s public insurance adjuster.
Preparing a captioned report to insurance company management.
Preparing a statement of loss.
Negotiating a first party claim with an insured.
Negotiating a third party claim with a claimant or lawyer.
Preparing a sworn proof of loss with an insured after agreement.
Requiring an insured to submit a sworn proof of loss if agreement cannot be reached.
Preparing a release of all claims after reaching settlement with a claimant or claimant’s counsel
Use of an Insurance Coverage and Claims Handling Expert in Insurance Litigation.
Insurance Fraud & Weapons to Fight Fraud;
The Examination Under Oath;
Presentation and Adjustment of Claims in a Catastrophe;
Appraisal, A Specialized and Narrow Type of Insurance Arbitration;
Rescission of Insurance Policies;
Catastrophes and Fraud;
Torts for the Claims Person — A Primer;
Avoiding the Tort of Bad Faith;
Arson and Arson for Profit;
Dealing with the Public Insurance Adjuster; or
Barry Zalma will customize a talk and speak on any insurance topic you require.

California Department of Insurance Issues 14 Cease and Desist Orders to Protect California Consumers from Unlicensed Health Coverage

The California Department of Insurance has issued a Cease and Desist Order against First Continental Life & Accident Insurance Company for illegally acting as an insurance company in the state and providing health coverage without the proper certification. The Department also served 13 additional Cease and Desist Orders on multiple entities and licensees that aided and abetted First Continental.

“When consumers purchase health coverage they should have full confidence that they have the coverage they are promised,” said Insurance Commissioner Ricardo Lara. “Transacting insurance without the proper licensing or certification is not only breaking the law, it is putting consumers at risk. My Department will continue to take action to protect consumers and stop illegal actions by companies and licensees.

The Department launched an investigation after receiving information that California consumers were sold health plans underwritten by First Continental. The investigation uncovered allegations that between October 2019 and September 2021 consumers purchased health insurance plans underwritten by First Continental. Many of these consumers thought their policies included full medical coverage; however, when these consumers attempted to use the coverage they found the coverage was limited and did not cover the medical expenses they were led to believe when they purchased the policies.

First Continental did not have authorization at the time to transact insurance in California. First Continental was previously authorized to transact in California, but after failing to meet policyholder requirements the Department issued a Cease and Desist Order against the company in 2002. In June 2012, First Continental officially withdrew from the State of California and has remained without the proper certificate of authority to transact business in the state.

Consumers who have purchased health coverage through First Continental or any of the below entities or licensees should contact the California Department of Insurance at (323) 278-5000.

The Cease and Desist Orders were served against the following:

First Continental
Administrative Concepts, Inc. – License #0C38805
Association for Better Health
Association Health Care Management, dba Family Care
Evolve Health
First Health Network
Get Me Care
National Association of Preferred Providers
Service Industry Trade Alliance
Matthew Deprey – License #0M50797
Curtis Garceau – License #4026934
Fabian Vergara – License #0M31165
Samantha Mabie – License #0L30001
Scott Russell – License #0N03621

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.

Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma; Follow Mr. Zalma on Twitter at https://twitter.com/bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/ Read posts from Barry Zalma at https://parler.com/profile/Zalma/posts; and the last two issues of ZIFL at https://zalma.com/zalmas-insurance-fraud-letter-2/ podcast now available at

Good News From the

An Anheuser-Busch employee bribed a chiro to exaggerate her med symptoms and score $457K of disability in the St. Louis area. Shannon Nenninger was part of a $12M suspected disability ring involving Anheuser-Busch employees. She paid chiro Thomas Hobbs $6.1K to doctor her symptoms in reports over nearly four years. Hobbs allegedly was known among Anheuser-Busch employees for providing fake medical leave slips and inflating patient’s medical conditions for disability claims. Social Security declared Nenninger totally and permanently disabled. She started receiving benefits. Yet all the while, Nenninger traveled internationally, attended concerts, did yard work, fished and attended social events. All this despite claiming she needed a cane and brace, and couldn’t take part in these activities. Nenninger received a year in federal prison and must repay the stolen money. Hobbs still faces trial.

Wearing a blue ski mask, a gunman shot Jennifer Faith’s husband Jamie seven times while he walked the family dog near their home. The gunman then attacked Jennifer, knocking her to the ground, then fled. Or so the Dallas woman told police and her life insurer. In fact, Jennifer had her lover shoot Jamie, who was the technology director for American Airlines. She stood to gain more than $600K from her life policy. Faith set up phony Gmail accounts to correspond with Lopez. She assumed Jamie’s ID and a friend’s to falsely convince Darrin Ruben Lopez that Jamie physically and sexually abused her. Faith attached stock images of injuries loaded from the internet to her emails. “Jamie slapped Jen … then he sent the pic of him choking her,” she emailed Lopez while posing as a friend. “I am asking if you are willing to get involved and help Jen get out of this situation.” Law enforcement found the .45 caliber handgun used to kill Jamie inside a satchel in Lopez’s home. Jamie’s blood was found on the gun. Lopez fled the shooting scene in his black Nissan Titan pickup. It had a distinctive “T” decal of the Texas Rangers baseball team on the back window. The pair then texted about removing the decal — and tried to delete those messages. Jenifer pled guilty and faces a potential federal life term when sentenced. Lopez still faces state murder counts and federal gun charges.

Busted for peddling ortho braces that seniors didn’t want or need, Patsy “Pat” Joseph Truglia simply opened up another operation and kept on stealing from Medicare — $25M in total attempted theft. The Parkland, Fla. man and cronies forged prescriptions for knee, back and wrist braces. They harvested info from Medicare beneficiaries with telemarketers. They sent the info to purported telemed vendors. For a fee, the vendors bribed docs to sign prescriptions without even examining the Medicare beneficiaries. To avoid Medicare scrutiny, Truglia spread the bogus claims across five storefronts. Truglia was caught up in a federal sweep, “Operation Brace Yourself.” His illegal storefronts were shut down. So Truglia simply opened up three new storefronts using new telemed vendors. He and his cronies made another $12M of false Medicare claims. Truglia bought a $1.25M home at the Parkland Golf & Country Club. He pled guilty and will be federally sentenced later.

The seven-year-old Olivia Grant seemingly had painful cancer, a seizure disorder, buildup of fluid in her brain and other maladies. Surgeons even removed part of Olivia’s intestines and inserted feeding tubes. The Denver-area girl finally died of intestinal failure. Sad problem is, Olivia was never sick. Her mother Kelly Turner invented the conditions to try and get rich — including a Medicaid ripoff. She convinced doctors that Olivia was desperately ill, thus subjecting the little girl to a life of painful and unneeded surgeries that sapped her strength. Turner’s fraudulent money grab included $538K stolen from Medicaid, plus crowdfunding and funds from charities such as Make-a-Wish. Turner had ginned up national and local news media coverage of Olivia’s courageous fight against so many seeming illnesses. A video by a suburban Denver municipal government even shows Olivia riding on a firetruck, putting out a dumpster fire and telling firefighters to stand for attention — all while laughing and smiling despite medical tubes poking out of her backpack. Olvia was admitted to the Children’s Hospital Colorado near the end of her life. She was deeply malnourished. Turner convinced doctors to withdraw Olivia’s feeding tube. She also imposed a “do-not-resuscitate” order. Olivia died shortly afterward. An autopsy showed none of Olivia’s claimed medical conditions ever existed. Turner pled guilty and received 16 years in state prison.

Wandale Fulton tossed his surrender towel into the ring. The Kansas City, Mo. man admitted he bought houses, insured them, had them burned or vandalized, and then filed false claims on the wrecked homes (Cohorts made false claims on insurance applications. Such as claiming the houses were rented or occupied, valuable possessions were destroyed, and the houses had been renovated — thus falsely raising their insurance value. After obtaining insurance, Fulton hired a torch to burn down the house. The homeowner then claimed a total loss with the insurance company. Latest case update: Fulton pled federally guilty. He could spend up to 20 years in federal prison without parole. He also faces a potential mandatory consecutive sentence of 10 years without parole for using fire in committing a federal felony. He’ll be sentenced later.

Michael Leonard Morgan-Towe recruited people in financial need — lying they’d get months of free life insurance by handing over their personal ID info to him in the Virginia Beach, Va. area. Local agent Antoinette D. Pringle used their info to take out the life policies. She inflated the victims’ incomes to make it seem they could pay the monthly premiums. Pringle also misstated their health conditions to ensure the applications were approved. The life insurers sent Pringle $150K of advance commissions as soon as the applications were approved. She shared the money with Morgan-Towe. Yet almost all of the policies lapsed immediately because no premiums were paid — the victim beneficiaries still thought they had free life insurance. Morgan-Towe received 27 months in prison. Pringle earlier was given four years.

The Insurance Examination Under Oath

A Tool Available to Insurers to Thoroughly Investigate Claims

The insurance Examination Under Oath (“EUO”) is a formal type of interview authorized by an insurance contract. It is taken under the authority provided by a condition of the insurance contract that compels the insured to appear and give sworn testimony on the demand of the insurer or find his, her or it claim rejected for breach of a condition. A notary and a certified shorthand reporter are always present to give the oath to the person interviewed and record the entire conversation.

The EUO is a tool used sparingly by insurers in the United States when a thorough claims investigation raises questions about the application of the coverage to the facts of the loss, the potentiality that a fraud is being attempted, or to assist the insured in the obligation to prove to the insurer the cause and amount of loss. Although rarely used the EUO is an important tool needed by insurers when there is a question of coverage.

The Reason for the Examination Under Oath

Courts that construe submission to an EUO as a condition precedent to recovery generally do not require the insurer to prove that it suffered actual prejudice from an insured’s unexcused refusal to submit to an examination. Lorenzo–Martinez v. Safety Ins. Co., 58 Mass. App. Ct. 359, 790 N.E.2d 692, 695–96 (2003). The EUO provides a mechanism for the insurer to corroborate the claim by obtaining information that is primarily or exclusively within the possession of the insured.

The adjuster, the independent adjuster, the Special Investigation Unit (“SIU”) investigator, the independent insurance adjuster and, in complex cases, the attorney retained to represent the insurer questions the person interviewed in a manner similar to a deposition in a legal proceeding. Because of the formality of the proceeding — it includes an oath, and the presence of a certified shorthand reporter — the task of establishing rapport with the person interviewed so that relevant information may be obtained from the insured is more difficult than in an informal interview. Unlike legal proceedings where questions are limited to those seeking a “yes” or “no” or brief answer the EUO seeks narrative responses from the person questioned.

The person taking the EUO, therefore, must be capable of transitioning from lawyer like questions in litigation to the broad, inquisitive, narrative seeking questioning. An EUO should never be conducted as if it is an adversarial activity but merely a fact seeking activity that is directed to the needs of an insurance policy and the need to prove a loss is either compensable or not.

Because the EUO is a tool for gleaning the maximum amount of information the EUO is an effective weapon against insurance fraud. This is because the person taking the EUO is knowledgeable about insurance and insurance law while the person being questioned is only aware of the claim presented and the fraud he or she may be attempting.

Often, however, the purpose of the EUO is not to stop fraud but to allow an insured the opportunity to prove his or her claim of loss in cases where evidence has been destroyed by a casualty or is otherwise unavailable.

The authority to take an EUO is provided by the insurance contract and exists, as a result of statutes, establishing a state mandated fire insurance policy that must be incorporated in every policy in the state that insures against the peril of fire. For example, the New York Standard Fire Policy provides as follows:

The insured, as often as may be reasonably required, shall exhibit to any person designated by this company all that remains of any property herein described and submit to EUO by any person named by this company, and subscribe the same; and as often as may be reasonably required, shall produce for examination and copying all books of account, bills, invoices, and other vouchers... (Emphasis added)

Similarly, the 1991 edition of the Homeowners policy provides, in easy to read language:

“2.          Your Duties After Loss. In case of a loss to covered property, you must see that the following are done:
* * *
“f.            As often as we reasonably require:
                “(1)         Show the damage property.
                “(2)         Provide us with records and documents we request and permit us to make copies; and
                “(3)         Submit to EUO, while not in the presence of any other “insured” and sign the same.” [ISO form HO 00 03 04 91, PAGE 9 OF 10]

In Shaw v. State Farm Fire and Cas. Co., 37 So.3d 329, 35 Fla. L. Weekly D1020 (2010) Florida concluded that State Farm had every right to include the EUO provision in its contract as a condition precedent to payment or suit, just as insurance companies have done in Florid for over a century; State Farm had every right to expect and require that the EUO requirement be complied with by any person or organization making a claim or seeking payment so that State Farm can determine whether the claim Claflin v. Commonwealth Ins. Co., 110 U.S. 81, 3 S.Ct. 507, 28 L.Ed. 76 (1884)] is proper or fraudulent; and State Farm had every right to require and expect that this clause be complied with by assignees of PIP benefits who are no less capable of filing fraudulent claims than insureds. According to the Florida Court of Appeal, the insured and his assignees—the Appellants—do not have the right to take this valuable contract right and investigative tool away from State Farm through the mere expedient of an assignment.

Although the EUO is a formal proceeding it is not part of a judicial process. The EUO is not controlled by the rules of civil procedure. In most states it is considered a condition precedent to recovery under a policy of insurance. The EUO is not limited by any statute relating to civil discovery. Some states have enacted regulations that try to limit insurers taking of the EUO and place certain requirements upon the insurer to chill the desire to take an EUO.

Depositions and examinations under oath serve vastly different purposes. First, the obligation to sit for an examination under oath is contractual rather than arising out of the rules of civil procedure. Second, an insured’s counsel plays a different role during examinations under oath than during depositions. Third, examinations under oath are taken before litigation to augment the insurer’s investigation of the claim while a deposition is not part of the claim investigation process. Fourth, an insured has a duty to volunteer information related to the claim during an examination under oath in accordance with the policy while he would have no such obligation in a deposition. [Beasley v. GeoVera Specialty Ins. Co., Slip Copy, 2015 WL 2372328 (E.D.La., 2015)]

An insurer’s right to ask questions at EUO is basically unlimited.

As early as 1884, the U.S. Supreme Court explained the purpose of the EUO, as follows:

The object of the provisions in the policies of insurance, requiring the assured to submit himself to an EUO, to be reduced to writing, was to enable the company to possess itself of all knowledge, and all information as to other sources and means of knowledge, in regard to the facts, material to their rights, to enable them to decide upon their obligations, and to protect them against false claims. And every interrogatory that was relevant and pertinent in such an examination was material, in the sense that a true answer to it was of the substance of the obligation of the assured. A false answer as to any matter of fact material to the inquiry, would be fraudulent. If it made, with intent to deceive the insurer, would be fraudulent. If it accomplished its result, it would be a fraud effected; if it failed it would be a fraud attempted. And if the matter were material and the statement false, to the knowledge of the party making it, and willfully made, the intention to deceive the insurer would be necessarily implied, for the law presumes every man to intend the natural consequences of his acts. No one can be permitted to say, in respect to his own statements upon a material matter, that he did not expect to be believed; and if they are knowingly false and willfully made, the fact that they are material is proof of an attempted fraud, because their materiality, in the eye of the law, consists in their tendency to influence the conduct of the party who has an interest in them, and to whom they are addressed. [Claflin v. Commonwealth Ins. Co., 110 U.S. 81, 3 S.Ct. 507, 28 L.Ed. 76 (1884)] (Emphasis added)

The position taken by the U.S. Supreme Court in Claflin has been upheld by every court that has considered it to date. For example, in Gipps Brewing Corp v. Central Manufacturers Mutual Insurance Co., 147 F.2d 6, 13 (C.A. 7, 1945) the Seventh Circuit stated:

We think there is no escape from the conclusion that these witnesses purposefully refused to answer questions upon EUO which were material to the inquiry. We see no basis for refusal to answer upon the ground that they were controversial or that the answers thereto might have been used for the purpose of impeachment. Such a limitation would seriously impair and perhaps destroy defendants’ right under this provision of the policy. We would think that defendants had a right to examine as to any matter material to their liability, as well as to its extent. (Emphasis added

In light of the evidence cited by the defendants (of which these are only a few examples), a reasonable juror could conclude that the plaintiff breached the insurance policy by not carrying out her duties as the insured party, thereby rendering the policy void. [Akers v. Liberty Mut. Group, 847 F.Supp.2d 21 (2012)]

Similarly, based on the undisputed facts, a court concluded that there could be no question that Thomas made false statements when he applied for coverage and during the claims process. Thomas (the insured), “made false statements ... relating to this insurance” both before and after the loss. Under the express terms of the Policy, AFI therefore can void “[t]he entire policy[.]” Thomas contended, however, that he “had no intent to defraud at any stage of the insurance procurement or claims processes.” But, effective with the repeal of former Michigan Compiled Laws Section 500.2832, the insured’s intent was no longer relevant when the insurer seeks to void a policy based on a false statement where the policy contains the involved. [Thomas v. Armed Forces Ins. Exchange, Slip Copy, 2015 WL 2063064 (E.D.Mich., 2015)]

[This article was adapted from my book, Insurance Fraud Volume II – Volume One available as a Kindle book and a paperback. Volume Two Available as a Kindle book and a paperback]

Health Insurance Fraud Convictions

Psychiatrist Sentenced to Only 120 Days for Falsifying Disability Reports

George Demetrius Karalis pleaded guilty on Aug. 11 and was sentenced February 9, 2022. Federal prosecutors announced that Karalis, a Northern California psychiatrist, was sentenced to only 120 days in jail and ordered to pay $1.4 million in restitution after pleading guilty to a scheme to falsify disability reports to allow clients to receive workers compensation benefits to which they were not entitled.

The government’s sentencing memorandum describes meetings between Mr. Karalis and undercover agents in which he instructed clients on how to obtain federal and state benefits.

According to his plea agreement, Karalis admitted that between August 2015 and June 30, 2020, he treated U.S. Postal Service employees who received Federal Employees’ Compensation Act workers’ compensation benefits for stress, and alleged psychological disorders. Karalis also advised non-disabled clients on how to continue to receive benefits to which they were not entitled. Karalis also admitted to submitting false reports and certifications about his clients so that they could continue to receive FECA benefits.

Karalis agreed to pay $1.4 million in restitution, with $920,000 going to the USPS and $480,000 going to the California Employment Development Department.

Karalis may be one of the reasons the USPS is always short of money and keeps raising the prices of stamps while reducing service.

Milwaukee Pharmacy Chain to Pay Over $2 Million To Resolve False Claims Act Violations

Hayat Pharmacy agreed to pay $2,050,000 to resolve allegations that it submitted false claims to Medicare and Medicaid for prescription medications.

Hayat Pharmacy operates 23 pharmacy locations in the greater Milwaukee area. The United States alleged that Hayat Pharmacy submitted false claims to Medicare and Medicaid in 2019 for two prescription medications, a topical cream consisting of iodoquinol, hydrocortisone, and aloe, and a multivitamin with the trade name Azesco. During the relevant time period, Medicaid paid thousands of dollars per prescription for the iodoquinol-hydrocortisone-aloe cream, and Medicare paid hundreds of dollars per prescription for Azesco. The United States alleged that Hayat Pharmacy switched Medicaid and Medicare patients from lower cost medications to the iodoquinol-hydrocortisone-aloe cream and Azesco without any medical need and/or without a valid prescription. In addition to paying over $2 million to resolve the allegations concerning these false claims, Hayat Pharmacy agreed to conduct annual training concerning waste, fraud and abuse, and compliance with rules concerning medication switches.

The government’s investigation resulted from a whistleblower complaint filed under the qui tam provisions of the False Claims Act.

The whistleblower will receive a share of the settlement. The lawsuit is captioned United States ex rel. Hussein v. Hayat Pharmacy, LLC, et al., 20-cv-472, and is pending in the District Court for the Eastern District of Wisconsin.

Qui Tam Succeeds & Cardinal Health to Pay More Than $13 Million To Resolve Kickbacks Allegations

Cardinal Health, Inc., has agreed to pay $13,125,000 to resolve allegations that it violated the False Claims Act by paying “upfront discounts” to its physician practice customers, in violation of the Anti-Kickback Statute.

The Anti-Kickback Statute prohibits pharmaceutical distributors from offering or paying any compensation to induce physicians to purchase drugs for use on Medicare patients. When a pharmaceutical distributor sells drugs to a physician practice for administration in an outpatient setting, the distributor may legally offer commercially available discounts to its customers under certain circumstances permitted by the Office of Inspector General for the Department of Health and Human Services (HHS-OIG). HHS-OIG has advised that upfront discount arrangements present significant kickback concerns unless they are tied to specific purchases and that distributors maintain appropriate controls to ensure that discounts are clawed back if the purchaser ultimately does not purchase enough product to earn the discount. According to facts that the company has acknowledged in the settlement agreement, Cardinal Health, Inc. failed to meet these requirements because the upfront discounts it provided to its customers were not attributable to identifiable sales or were purported rebates which Cardinal Health’s customers had not actually earned.

The False Claims Act settlements resolve allegations originally brought in lawsuits filed by whistleblowers under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery.

In connection with today’s announced settlement, the relators will receive approximately $2.6 million of the recovery.

Psychologist Sentenced for Medicaid Fraud Scheme Involving Minors

Dr. Malik Muhammad, Ph.D., 46, a Durham, North Carolina, clinical psychologist was sentenced February 1, 2022 to 52 months in prison for defrauding Virginia Medicaid of at least $544,067.69 by creating false diagnoses and medical records for Medicaid recipients, mostly minors, and falsely representing to Medicaid that he was providing them mental health services.

According to court documents, obtained identifying information of Medicaid recipients from a co-conspirator and used that information to bill Virginia Medicaid for outpatient psychotherapy that never actually occurred. Muhammad, a licensed clinical psychologist, hired a co-conspirator to write patient medical records as if Muhammad had performed actual therapy and created inapplicable diagnoses — including depression, anxiety, attention deficit disorder, and post-traumatic stress disorder — to give the appearance of actual treatment. The mostly minor victims were unaware of the false diagnoses Muhammad was inventing and applying to them.

Through this fraud scheme, Muhammad defrauded Virginia Medicaid of at least $544,067.69.

Georgia Nurse Practitioner Convicted of Health Care Fraud in Complex Telemedicine Fraud Scheme

Fraudulent orders included knee brace for leg amputee

Sherley L. Beaufils, 43, of Conyers, Ga., was convicted after a two-day trial on charges of an illegal kickback conspiracy, and five counts each of Health Care Fraud, False Statements Related to Health Care, and Aggravated Identity Theft. Conviction on the charges subjects Beaufils to a possible statutory sentence of up to 10 years in prison on each count of Health Care Fraud, two years on each count of Aggravated Identity Theft, and five years in prison on all other counts, along with substantial fines and penalties, followed by a period of supervised release upon completion of any prison term. There is no parole in the federal system.

As described in court documents and testimony, Beaufils, as a nurse practitioner, facilitated orders for more than 3,000 orthotic braces that generated more than $3 million in fraudulent or excessive charges to Medicare. Co-conspirators captured the identities of senior citizens, identified through a telemarketing scheme, and bundled that information as “leads.”

Beaufils then signed her name to fake medical records, in which she falsely claimed she provided examinations of those patients, and then created orders for orthotic braces for patients she never met or spoke with – including a knee brace for an amputee, and a back brace for a recently deceased patient – and other durable medical equipment, in exchange for money. Beaufils’s fraudulent orders were then sold to companies that would generate reimbursement from Medicare.

Beaufils was found not guilty at trial of one additional charge of conspiracy.

South Florida Man Sentenced To 15 Years for Consecutive Health Care Fraud Conspiracies

Patsy Truglia, 54, of Parkland, Florida to 15 years in federal prison for his role in two consecutive conspiracies to commit health care fraud and for making a false statement in a matter involving a health care benefit program. As part of his sentence, the Court ordered Truglia to pay $18.3 million to the affected government health programs and an insurance company. The Court also entered a money judgment against Truglia in the amount of $10,117,738 and ordered him to forfeit numerous assets, including $9,308,235.86 seized from various financial accounts, high-end automobiles (Rolls Royce, Lamborghini, and Mercedes), jewelry, and Truglia’s lakefront home, all of which were traceable to the charged criminal conduct. Truglia had pleaded guilty on October 5, 2021.

According to court documents, beginning in January 2018 and continuing into April 2019, Truglia and other conspirators, including co-defendant Ruth Bianca Fernandez (who worked under Truglia’s supervision), generated medically unnecessary physicians’ orders via their telemarketing operation for certain orthotic devices — knee braces, back braces, wrist braces, and other braces — referred to as durable medical equipment (“DME”). Through the telemarketing operation, federal health care program beneficiaries’ (i.e., Medicare beneficiaries’) personal and medical information was harvested to create the unnecessary DME brace orders.

The brace orders were then forwarded to purported “telemedicine” vendors that, in exchange for a fee, paid illegal bribes to physicians to sign the orders, often without ever contacting the beneficiaries to conduct the required telehealth consultations. The fraudulent, illegal brace orders were then returned to Truglia’s telemarketing operation, which used the orders as support for millions of dollars in false and fraudulent claims submitted to the Medicare program. To avoid Medicare scrutiny, Truglia and Fernandez spread the fraudulent claims across five DME storefronts operated under Truglia’s ownership and control and Fernandez’s day-to-day management. In all, through their five storefronts, Truglia, Fernandez, and other conspirators caused approximately $25 million in fraudulent DME claims to be submitted to Medicare, resulting in approximately $12 million in payments.

On April 9, 2019, multiple federal law enforcement agencies participated in a nationwide action referred to as “Operation Brace Yourself.” The operation targeted ongoing schemes, such as Truglia’s, in which companies were paying illegal bribes to secure signed physicians’ DME brace orders for use as support for fraudulent claims submitted to the federal programs. In the Middle District of Florida, the April 2019 Operation included, among other efforts, the execution of search warrants at several of Truglia’s DME storefronts and a civil action under which, among other ramifications, enjoined Truglia and (by extension) his five storefronts from engaging in any further health care fraud conduct.

Undeterred, beginning in or around April 2019 and continuing into July 2020, Truglia and other conspirators—some of whom had worked with Truglia in the earlier conspiracy and some of whom were new conspirators—carried out a similar conspiracy using three new DME storefronts and different “telemedicine” vendors. Through this conspiracy, Truglia and his conspirators caused an additional approximately $12 million in fraudulent DME claims to be submitted to Medicare, resulting in approximately $6.3 million in payments.

Doctor Sentenced for Illegal Drug Distribution and Health Care Fraud

Yee Chung Ho, age 72, a physician, was sentenced to three years of probation, including 180 days of home detention. Ho also was ordered to pay restitution totaling $6,500 to Medicare, and to forfeit his Drug Enforcement Administration number, Pennsylvania state license to practice medicine, and $89,280.00 to the United States. Ho was further ordered to serve 250 hours of community service.

During the defendant’s plea hearing on November 9, 2021, Ho admitted that, while practicing as a licensed medical doctor at his family medicine practice located in Pittsburgh, Pennsylvania, he knowingly dispensed and distributed Schedule II drugs, specifically, Oxycodone, to a patient outside the usual course of professional practice and not for a legitimate medical purpose. Ho also admitted that, from April 2018 through June 2019, he committed health care fraud by causing fraudulent claims to be submitted to Medicare for payments to cover the costs of unlawfully prescribed drugs.

Pharmacy Owner Sentenced To 2½ Years in Federal Prison For $14 Million Health Care Fraud Scheme

Navid Vahedi, 42, of Brentwood, California was sentenced by United States District Judge Christina A. Snyder to 30 months in federal prison. Vahedi and his West Los Angeles-based company, Fusion Rx Compounding Pharmacy, pleaded guilty in February 2021 to one count of conspiracy to commit health care fraud and payment of illegal remunerations. Vahedi admitted he orchestrated a scheme that fraudulently obtained millions of dollars for compounded drugs in a scheme that paid illegal kickbacks for patient referrals and fraudulently paid patients’ copayments.

On January 18, Judge Snyder sentenced Fusion Rx Compounding Pharmacy to five years of probation. She has ordered Vahedi and his company to jointly pay $4,400,525 in restitution.

Fusion Rx was a provider of compounded drugs, which are tailor-made products doctors may prescribe when FDA-approved alternatives do not meet the health needs of patients. Vahedi, a licensed pharmacist, and Fusion Rx routed millions of dollars in kickback payments through the businesses of two marketers to steer prescriptions for compounded drugs to Fusion Rx.

As part of the scheme, Vahedi and the two marketers provided physicians with preprinted prescription script pads that offered “check-the-box” options on the form to maximize the amount of insurance reimbursement for the compounded drugs. From May 2014 to at least February 2016, Fusion Rx received approximately $14 million in reimbursements on its claims for compounded drug prescriptions.

As part of its contracts with various insurance networks, Fusion Rx was obligated to collect copayments from patients. Because the copayments might discourage patients from requesting expensive and potentially unnecessary compounded drug prescriptions, Fusion Rx did not collect copayments with any regularity and, in other instances, it provided gift cards to patients to offset the amount of the copayments, according to court documents.

After an audit raised concerns that Fusion Rx’s failure to collect copayments would be discovered, Vahedi directed Fusion Rx funds to be used to purchase American Express gift cards, which were then used to make copayments for certain prescriptions without the patients’ knowledge. Fusion Rx then submitted claims on these prescriptions to various insurance providers, falsely representing that patients had paid the required copayments.

The two marketers involved in the scheme – Joshua Pearson, 42, of St. George, Utah, and Joseph Kieffer, 41, of West Los Angeles – previously pleaded guilty in this case. Judge Snyder sentenced Kieffer to six months in federal prison and ordered him to pay $1.25 million in restitution. Pearson was sentenced to three years of probation.

Vascular Surgeon Pleads Guilty in Connection With $19.5 Million Fraud

Dr. Vasso Godiali, 59, a vascular surgeon from Bay City, Michigan pleaded guilty February 8, 2022 to participating in a scheme to defraud Medicare, Medicaid, and Blue Cross/Blue Shield out of approximately $19.5 million.

According to the plea agreement, Godiali began knowingly defrauding the three medical insurers in approximately 2009 and did so by causing the submission of false billing to all three insurers. As evidenced in the plea agreement, Godiali’s false and fraudulent billing includes admissions related to claims for the placement of stents in dialysis patients and for the treatment of arterial blood clots. Godiali admitted that he billed for the placement of multiple stents in the same vessel, and prepared medical records purporting to document the medical necessity justifying that billing. In fact, Godiali did not place those stents, and he admitted to billing the insurers for services never rendered while preparing materially inaccurate medical records to justify the fraudulent billing. With respect to arterial blood clots, the plea agreement documents a similar pattern of misconduct. Godiali acknowledged that his medical records would describe encountering occluded arteries that would appear to justify the performance of arterial thrombectomies. In fact, as Godiali admitted that he often encountered no such occlusions, performed no such thrombectomies, and thus billed insurers for services never rendered while preparing false medical records to justify the fraudulent claims.

Sentencing is set for September 15, 2022. Godiali faces up to ten years’ imprisonment and the forfeiture of $19.5 million. Under the terms of the plea agreement, Godiali will be required to pay $19.5 in restitution to Medicare, Medicaid, and Blue Cross Blue Shield of Michigan. A civil forfeiture case against approximately $39.9 million seized from accounts controlled by Godiali remains pending.

Catholic Medical Center Agrees to Pay $3.8 Million To Resolve Kickback False Claims Act Allegations

Catholic Medical Center (CMC) has agreed to pay $3.8 million to resolve allegations that it violated the civil False Claims Act by providing free call coverage services to a cardiologist to induce patient referrals, in violation of the Anti-Kickback Statute.

According to the settlement agreement, the United States asserted that CMC, a hospital in Manchester, New Hampshire paid its own cardiologists to cover for, and to be available to provide medical services for, another cardiologist’s patients when she was on vacation or otherwise unavailable. The United States further alleged that CMC provided these call coverage services at no charge. The cardiologist who received the free call coverage referred millions of dollars in medical procedures and services to CMC over the decade in which the free services were provided. Because CMC submitted claims for payment to Medicare, Medicaid, and other federal health care programs for the services referred by the cardiologist, the United States alleged that these claims were the result of unlawful kickbacks.

The Anti-Kickback Statute makes it illegal for a hospital to pay physicians in exchange for referrals of government insured health care programs, such as Medicare, Medicaid, or Tricare. It arose out of congressional concern that remuneration given to those who can influence health care decisions would result in the provision of medically unnecessary services, or services of poor quality or otherwise harmful to patients.

The False Claims Act permits whistleblowers to file civil lawsuits alleging that false claims have been submitted to the United States. This False Claims Act settlement resolves allegations originally brought in a lawsuit filed by a whistleblower, David Goldberg, M.D., a former CMC employee, who is represented by Douglas, Leonard & Garvey, P.C. As part of the settlement the whistleblower will receive a portion of the settlement amount.

CMC did not admit liability as part of this settlement agreement.

Western New York Optician Convicted for Medicaid Fraud

Optician Thomas Foote Fraudulently Billed Medicaid for Services for Deceased Nursing Home Residents

Foote Pleaded Guilty to Grand Larceny and was Sentenced to 90 Days in Prison, 5 Years’ Probation, and Ordered to Pay $74,000 in Restitution

Thomas Foote, 59, of Wyoming County, New York, was convicted for defrauding New York state by submitting false Medicaid claims for optician services that he claimed were for nursing home residents, but were never provided. The conviction concludes an investigation by the Office of the New York Attorney General’s (OAG) Medicaid Fraud Control Unit (MFCU), which found that many of the residents Foote claimed to have provided these services to were actually deceased and that he never actually visited the nursing homes on the dates he submitted claims for. Foote was ultimately arrested and charged with Grand Larceny in October last year.

As outlined in the charges, Foote fraudulently received approximately $74,000 in Medicaid payments between 2016 and 2019 by billing for optician services that were never provided. The OAG’s investigation revealed that many of the patients Foote claimed to have fitted eyeglasses for were actually deceased on the dates he claimed to have serviced them, and that he even continued billing for services multiple times after those dates. Additionally, nursing home visitor logs and records also revealed that Foote never visited the nursing homes on dates he claimed to have provided services to the residents.

Previously, Foote pled guilty to Grand Larceny in the Fourth Degree, a class E Felony, before the Honorable Michael M. Mohun in Wyoming County Court. He was sentenced to 90 days in state prison, followed by 5 years’ probation, and is ordered to pay $74,000 in restitution.

Woman Pleads Guilty to Insurance Fraud Involving Coachella Valley Cosmetic Surgery Center

Linda Morrow, the former executive director of a surgical center who helped her physician husband bilk insurance companies of $44 million for cosmetic procedures billed as “medically necessary” has pleaded guilty on Friday, Feb. 4, 2022, to health care fraud. Morrow, who was captured in Israel after she fled the country following her indictment, faces up to 20 years in federal prison. Her husband, Dr. David Morrow, is serving a 20-year term.

The former executive director of The Morrow Institute clinic pleaded guilty in U.S. District Court to a health care fraud conspiracy in which she billed insurance companies between $25 million and $65 million from 2007 to 2011 for procedures that were merely cosmetic. She faces up to 20 years in prison.

For someone looking to trim some belly flab, downsize their nose or pump up their breasts, the deal was almost too good to turn down.

Patients were promised free liposuction, nose jobs, breast augmentation and vaginal rejuvenation for free if they helped fudge the paperwork by signing “testimonial” letters or declarations with false statements.

Tummy tucks were listed on paperwork as hernia repair or abdominal reconstruction. Nose jobs were recorded as correcting a deviated septum. Breast jobs were supposedly to fix a “tuberous breast deformity.”

One patient listed in court documents said she received cash in exchange for undergoing several procedures that were billed to insurance for nearly $1 million.

In 2009, the woman went into the Morrow Medical Surgery Center in Rancho Mirage for a procedure listed in documents as necessary to reconstruct a breast deformity. In truth, she was getting breast implants.

Patients were often pressured to undergo multiple procedures they were not seeking in exchange for the improvements they sought so the Morrows could make more money, prosecutors said.

Major insurers such as Aetna, Anthem Blue Cross, Blue Shield of California and Cigna Health Insurance were listed as victims. However, in addition, local school districts were defrauded of more than $15 million.

David Morrow, 77, who fled the country with his wife in 2017 after he pleaded guilty, is serving a 20-year prison sentence. He was stripped of his license as a plastic surgeon.

North Carolina Psychologist Sentenced for Medicaid Fraud Scheme Involving Minors

Dr. Malik Muhammad, Ph.D., 46, a Durham, North Carolina, clinical psychologist was sentenced February 1, 2022 to 52 months in prison for defrauding Virginia Medicaid of at least $544,067.69 by creating false diagnoses and medical records for Medicaid recipients, mostly minors, and falsely representing to Medicaid that he was providing them mental health services.

According to court documents, Muhammad obtained identifying information of Medicaid recipients from a co-conspirator and used that information to bill Virginia Medicaid for outpatient psychotherapy that never actually occurred. Muhammad, a licensed clinical psychologist, hired a co-conspirator to write patient medical records as if Muhammad had performed actual therapy and created inapplicable diagnoses — including depression, anxiety, attention deficit disorder, and post-traumatic stress disorder — to give the appearance of actual treatment. The mostly minor victims were unaware of the false diagnoses Muhammad was inventing and applying to them. Through this fraud scheme, Muhammad defrauded Virginia Medicaid of at least $544,067.69.

Other Insurance Fraud Convictions

Oceanside Man Convicted of Defrauding Ill Brother Out Of $120,000

Randall Smith, 64, of Oceanside, was convicted on one felony count of forgery after misusing his power of attorney to steal over $120,000 from his brother’s annuity policy. According to the California Department of Insurance, Smith was sentenced to two years’ probation and ordered to pay $120,000 restitution to the beneficiaries of his now deceased brother and victim, Garrett Smith.

In July 2012, Garrett Smith, brother of Randall Smith, purchased a $1.2 million annuity policy. Garrett Smith had been diagnosed with early onset dementia earlier that year. In February 2013, Randall Smith obtained power of attorney for his brother because of Garrett Smith’s diagnosis.

An investigation by the Department of Insurance found that between April 2014 and June 2015 Randall Smith misappropriated over $120,000 from his brother’s annuity by making six separate withdrawals from the policy without his brother’s knowledge. Randall Smith withdrew the funds by impersonating his brother during telephone calls with the insurance company and forging the policy beneficiary’s signature on documents.

As a result of Randall Smith’s fraudulent actions, his brother incurred an additional loss of approximately $92,000 due to penalties and early withdrawal fees from the insurance company. Garrett Smith died on December 31, 2015, at the age of 56. The judge must have been in a good mood to give probation only to such despicable conduct.

Jennifer Faith Pleads Guilty to Murder for Hire in Husband’s Death

Jennifer Lynne Faith, the Oak Cliff, Texas woman who convinced her boyfriend to shoot her husband to death, pleaded guilty on February 7, 2022 to orchestrating the murder.

In February 2021, prosecutors charged Ms. Faith, 49, with obstruction of justice. In September 2021, they added a charge of use of interstate commerce in the commission of murder-for-hire, an offense that carries a potential death sentence. Ms. Faith pleaded guilty to the murder-for-hire charge before U.S. District Judge Jane J. Boyle on the morning of February 7, 2022. In return for her plea, prosecutors agreed to drop the obstruction charge and to recommend a sentence of life imprisonment. Sentencing will ultimately be at the discretion of the judge.

According to plea papers, Ms. Faith admitted that her boyfriend, Darrin Ruben Lopez, 49, gunned down her husband, American Airlines technology director Jamie Faith, on Oct. 9, 2020 in front of his home in Oak Cliff. (Mr. Lopez has been charged by the state with murder and by the feds with a gun crime. He has pleaded not guilty to both charges. Like all defendants, he is presumed innocent until proven guilty in a court of law.)

Ms. Faith admitted that she knew Mr. Lopez – whom she called her “one and only love” – had suffered a traumatic brain injury while serving in the U.S. Army in Iraq, leaving him disabled. Both before and after the murder, she sent Mr. Lopez money and gifts, and even provided him with two credit cards which she paid off using the proceeds of a “Support Jennifer Faith” GoFundMe fundraiser launched in the wake of her husband’s death.

She also admitted that before the murder, she used two phony email accounts to correspond with Mr. Lopez, assuming the identities of her own husband and one of her friends in order to falsely convince Mr. Lopez that her husband was physically and sexually abusing her. (In plea papers, Ms. Faith stipulated that no such abuse ever occurred.) Ms. Faith admitted that she downloaded stock images depicting injuries from the internet and attached them to some of the emails to convince Mr. Lopez that the abuse was actually occurring.

Seven months into her relationship with Mr. Lopez, Ms. Faith exited her home with her husband to walk their dog, she acknowledged in plea papers. One minute into their walk, Mr. Lopez – who allegedly drove from his home in Cumberland Furnace, Tennessee, to the Faiths’ home in Dallas, where he laid in wait at a neighbor’s home – allegedly shot Mr. Faith seven times before fleeing the scene in his black Nissan Titan pickup truck, which had a distinctive “T” decal on the back window.

After she learned that law enforcement was aware of the “T” decal, Ms. Faith appeared on DFW’s ABC affiliate, WFAA, and plead with the public to help investigators locate the decaled truck. Following the interview, Ms. Faith texted Mr. Lopez and encouraged him to remove the sticker from his truck, she admitted.

Meanwhile, approximately one month after her husband’s death, Ms. Faith admitted, she initiated a claim with Metropolitan Life Insurance Company seeking approximately $629,000 in death benefits Mr. Faith had through his employer. She periodically updated Mr. Lopez on the status of the claim. In text messages, the pair discussed using the money to apply for a residence in her name in Tennessee.

In January 2021, shortly after she was asked to come in for questioning by investigators, Ms. Faith reached out to Mr. Lopez to coordinate their cover stories, she admitted in plea papers.

“If asked about you, you are an old friend going through a divorce. We talk every night because I am helping/giving support with the girls,” she texted. “Just in case they pulled phone records and ask.”

“Good idea,” Mr. Lopez responded. “You are doing good.”

ATF agents arrested Mr. Lopez on murder charges in Cumberland Furnace on January 11, 2021. The firearm used to kill Mr. Faith was recovered inside Mr. Lopez’s home.

On Feb. 2, 2021, shortly before she was charged, Ms. Faith contacted a third party and asked that a message be forwarded to Mr. Lopez, who at the time was in custody in Dallas. “I am with him, will always be with him regardless of whatever has happened. I’ve needed to be cautious because every communication is being monitored,” the message read in part. “Please tell him ASAP I will always be his.”

The Office of the United States Attorney General approved Ms. Faith’s plea agreement, as is customary in cases involving death penalty eligible cases. She is slated to be sentenced on May 26.

Unlicensed Agent Gets Four Years in Prison For $1.4 Million Insurance Fraud

Karyl Lynn Reed, 58, formerly of Cosa Mesa, California, was convicted in February 2022 on multiple felony counts of embezzlement and white-collar fraud enhancements after defrauding three victims of over $1.4 million. Reed was sentenced to four years in prison and ordered to pay more than $1.4 million in restitution.

Reed was arrested last year in Seabrook, Texas, and was arraigned on October 27, 2021, in Orange County after she was extradited.

An investigation by the Department of Insurance found that between 2012 and 2019, Reed acted as an insurance agent without a license and collected premiums for workers’ compensation insurance through her businesses, Envoy Business Partners and Allenn Specialty Group. She would provide her victims with fraudulent Certificates of Insurance, causing her victims to believe they had valid coverage when there was actually none.

Reed hoodwinked local businesses by operating without a license to steal their money and leave them uninsured for workers’ compensation. The investigation discovered Reed also operated a staffing company without valid workers’ compensation coverage and personally adjusted and administered employee injury claims. She collected workers’ compensation premiums and payroll, employer and employee taxes from victims, and provided them with falsified Certificates of Insurance as well leading them to believe they were covered when they were not.

The Department’s investigation revealed that one victim did not have workers’ compensation coverage for an employee who became injured. Another victim had requested an updated Certificate of Insurance from their insurance company and were told no policy or coverage was in place and found out the policy number Reed had provided them belonged to a policy for another business. The investigation further revealed another victim who discovered the money they were paying Reed to her staffing service was not being remitted to the insurance company.

Guilty Again: Let Out of Prison Early so he Could Commit Arson & Insurance Fraud

Wandale J. Fulton, 40, was accused of conspiring with six others to buy houses, create fake lease agreements, and burn the structures down to collect on inflated insurance claims. The group is also accused of defrauding a credit union by obtaining fraudulent car loans. Fulton, a Kansas City-area man pleaded guilty to an arson and insurance fraud scheme that allegedly destroyed three houses from 2013 to 2019.

Fulton pleaded guilty on in January 2022 to one count of conspiracy to use fire in the commission of wire and mail fraud, one count of arson in the commission of a federal felony, and one count of conspiracy to commit bank fraud, according to the U.S. Attorney’s Office for the Western District of Missouri. In the plea agreement, Fulton admitted that he was in possession of unregistered firearms despite being a convicted felon.

Prosecutors say the conspirators tried to defraud insurers out of $500,000 during the six-year period, but netted only $300,000. According to an indictment handed down in 2019 and amended in 2020, Fulton established a company called Global Consultants in 2013 and used it to purchase properties from the Land Bank in Kansas City, Missouri.

Another conspirator, Jeremy Woods, was purportedly the owner of Global Consultants, but Fulton actually was in charge, prosecutors say. In August 2013, one of their co-conspirators renegotiated the mortgage on a home in Kansas City to prevent foreclosure. The unidentified conspirator then purchased a $130,000 insurance policy with Farmers Insurance.

The house was destroyed by fire in December 2014. Investigators determined the cause was arson. Nevertheless, Farmers paid $127,586 on the claim, most of which was used to pay off the mortgage. The unidentified conspirator, however, received a $14,409 payment from Farmers for “destroyed” personal property that actually never existed, the indictment says. Fulton was allegedly paid $7,000 from the insurance proceeds.

Fulton also filed a claim for purported vandalism to his own house in Lee’s Summit, Missouri in 2015. He told American Family Mutual Insurance Co. that three furnaces, three air conditioning condensers, a computer, a commercial lawn mower, a snow blower, tools, nine interior doors, toilets, furniture, a television and clothing had been stolen from his home. The house was going through foreclosure at the time.

Fulton stated on the claim that the total loss was $250,000 to $300,000. But Farmers refused to pay the claim after Fulton did not appear for an examination under oath. Also in 2015, Woods, doing business as Global Consultants, paid $25,000 for a house in Kansas City. He purchased an insurance policy from Foremost Insurance with coverage of up to $106,000 for the dwelling and $6,600 for lost rent.

Woods and Fulton drew up a false rental agreement that made it appear they had rented the home to Kirk Proctor for $550 per month. Proctor purchased a renter’s policy from Nationwide that paid up to $50,000 for the contents of the home.

The house was destroyed by fire on January 2, 2017. Investigators determined a flammable liquid had been used to torch the home. Global Consultants filed a claim for a total loss of the structure. Proctor also filed a claim to Nationwide seeking $47,623 for the contents of the home. The insurer paid $1,500 for temporary housing.

Proctor never lived at the home, according to the plea agreement. An investigation revealed that Missouri Gas Energy had never turned on service to the house. Proctor withdrew his claim after Nationwide told him it was under investigation. Woods attended an examination under oath as part of Foremost’s claims process, but he discontinued questioning after two hours. Foremost then denied the claim.

In 2016, the team purchased another Kansas City home from the Land Bank for $500 and purchased a $177,677 policy on the building. The home was destroyed in a suspicious fire in July 2017. Nationwide paid $1,000 for rent payments that allegedly been lost and $44,500 to demolish the house and remove debris. The insurer later paid $138,500 for the total loss of the structure.

Prosecutors say the fraud team also defrauded Heartland Community Credit Union by using fraudulent documents to obtain a total of $121,150 for six car loans.

When Bureau of Alcohol, Tobacco and Firearms agents searched Fulton’s home they discovered three unregistered weapons, leading to additional charges of possession of firearms by a convicted felon. Fulton had been convicted of manslaughter in 1999 and sentenced to 12 years in prison, but that sentence was suspended after he served only 120 days, according to court documents. Proctor and Woods entered into plea agreements with federal prosecutors last September. They have not yet been sentenced.

ZIFL OPINION

Another case where kindness to a criminal, changing a 12 year sentence for manslaughter to 120 days resulted in setting loose on the state a person willing to perform a crime that could have killed or injured neighbors or firefighters while profiting from the crime by defrauding insurers and banking institutions. The problem could have been avoided if Fulton served the full 12 year term.

Excellence in Claims Handling

A Series of Video Presentations and Text on Insurance Claims

Go to “Excellence in Claims Handling” and subscribe at https://barryzalma.substack.com/welcome and go to https://zalmaoninsurance.locals.com/subscribe subscribe to my locals account. See the introductory video at

and at https://rumble.com/vrhaka-excellence-in-claims-handling.html

Professional Insurance Adjusting

At the turn of the century, insurers, in a search for profit, decimated their professional claims sta. They laid off experienced personnel and replaced them with young, untrained and unprepared people.

A virtual clerk replaced the old professional claims handler. Process and computers replaced skill and judgment.

Insurers intentionally forgot that the promises made by an insurance policy are kept by the professional claims person. A professional claims staff is a cost-effective method to avoid litigation.

The professional claims person is an important part of the insurer’s defense to litigation against insurers for breach of contract.

A staff of claims professionals dedicated to excellence in claims handling are a profit center for an insurance company. Experience establishes that claims professionals resolve more claims for less money without the need for either party to involve counsel. A happy insured or claimant satisfied with the results of his or her claim will never sue the insurer.

Incompetent or inadequate claims personnel force insureds and claimants to lawyers. Every study performed on claims establish that claims with an insured or claimant represented by counsel cost more than those where counsel is not involved.

Prompt, effective and professional claims handling saves money and fulfills the promises made when the insurer sold the policy.

Insurers who believe they can handle first or third-party claims with young, inexperienced and inexpensive claims handlers will be faced with the screams of angry stockholders. Profits, thin as they are, will move rapidly into negative territory. Punitive damages as punishment for bad faith claims handling will deplete reserves. Insurers will quickly question why they are writing insurance. Those who stay in the business of insurance will either adopt a program requiring excellence in claims handling from every member of their claims staff, or they will fail.

Insurance is a business. It must change if it is to survive. It must rethink the firing of experienced claims staff and reductions in training to save “expense.”

Excellence in Claims Handling

Excellence in claims handling is a program that can help insurers avoid charges of bad faith in both first and third party claims.

An insurer must understand that it cannot adequately fulfill the promises it makes to it insured and the Fair Claims Practices Act which exist in almost every state, when dealing with claimants without excellence in claims handling. An insurer must work intelligently and with vigor to create a professional claims department.

A Proposal to Create Claims Professionals

To avoid claims of bad faith; to avoid punitive damages; to avoid losses; and to make a profit insurers must maintain claim staffs who are dedicated to excellence in claims handling. That means they will make sure every promise made in every policy is satisfied by the:

Insurers who only hire insurance claims professionals.
Insurers who train the claims staff to be insurance claims professionals.
Insurers who require that the claims staff treat every insured with good faith and fair dealing.
Insurers who demand excellence in claims handling from the claims staff.
The insurance industry for the last 25 years has decimated the number of insurance claims professionals for insurers to hire.
If any experienced claims professionals exist in the insurer’s staff, the insurer must cherish and nurture them. If none are available, the insurer has no option but to train its people.
Those who treat all insureds and claimants with good faith and fair dealing and provide excellence in claims handling must be honored with increases in earnings and perquisites.
The insurer must immediately eliminate those who do not provide excellence in claims handling from the claims staff.

What Sources Are Available to Obtain Training?

Insurance training is available across the country by correspondence, in local colleges and universities and from law firms that will provide the training as a marketing tool. None of these sources are directed to producing insurance claims professionals. They do provide the basic background information necessary to begin the process of becoming an insurance claims professional. In that regard, I have created electronic training programs on professional claims handling that are available from experfy.com and a different set of courses from illumeo.com.

An excellence in claims handling program can include a series of web-based lectures supported by text materials like my claims books available at amazon.com and over the insurance claims library at my web site at https://zalma.com.

The web lectures must be supplemented by meetings between supervisors and claims staff on a regular basis to reinforce the information learned in the lectures.

In addition, the insurer must institute a regular program of auditing claims files to establish compliance with the subjects studied. There is no quick and easy solution. The training takes time. Learning takes longer. The insurer’s management must support and reinforce the training regularly.

The excellence in claims handling program requires a minimum of the following:

The insurance policy — how to read and understand the contract that is the basis of every adjustment.
The formation of the insurance policy.
Tort law including negligence, strict liability in tort, and intentional torts.
Contract law including the insurance contract, the lease agreement, the bill of lading, non-waiver agreements, proofs of loss, releases and other claims related contracts.
The duties and obligations of the insured in a personal injury claim.
The duties and obligations of the insurer in a personal injury claim.
The duties and obligations of the insured in a first-party property claim.
The duties and obligations of the insurer in a first-party property claim.
The Fair Claims Practices Act and the regulations to enforce it.
The thorough investigation.
Basic investigation of an auto accident claim.
Basic investigation of a construction defect claim.
Basic investigation of a non-auto negligence claim.
Basic investigation of a strict liability claim.
Basic investigation of the first-party property claim.
The recorded statement of the first-party property claimant.
The recorded statement or interview of a third-party claimant.
The recorded statement of the insured.
The red flags of fraud.
The SIU and the obligation of the claims representative when fraud is suspected.
Claims report writing.
The evaluation and settlement of the personal injury claim.
How to retain coverage counsel to aid when a coverage issue is detected.
How to control coverage counsel.
How to retain an expert.
How to control the expert.
Dealing with a plaintiffs’ lawyer.
Dealing with personal injury defense counsel.
The evaluation and settlement of the property damage claim.
Arbitration and mediation and the claims representative

It Takes Courage to Fight Insurance Fraud

The legislatures of the various states, the United States Congress, the National Association of Insurance Commissioners, The National Insurance Crime Bureau and insurance industry groups have finally decided that the war against insurance fraud is worth fighting.

Until the states, the local police agencies, the district attorneys, the United States Attorneys, and the Attorneys General of the various states join in the battle it will be fought to a stalemate. The insurance industry cannot successfully fight insurance fraud alone.

Insurance industry sources estimate insurance fraud from lows of $80,000,000,000 ($80 billion) a year to highs of $300,000,000,000 ($300 billion) a year. Regardless of which, if any, estimate is accurate the amount of money going to insurance criminals is staggering and approaches no less than 3% to 10% of premium collected.

Every two weeks Zalma’s Insurance Fraud Letter publishes lists of convictions. The major volume of such convictions deal with Medicare and Medicaid fraud. Basic property and casualty fraud convictions are seldom described except when the perpetrator confesses or pleads guilty. Few go to trial. Those who are convicted usually are sentenced to short stays in jail or to home confinement.

Proposal

Insurance fraud is not a local problem. It is a depletion of the wealth of the entire country. The lawyer for the Department of Insurance of each state is the State Attorney General. A special unit could be established in the office of the Attorney General, funded with the monies taken from the insurance industry to support the war against insurance fraud. This unit should be given a simple mandate:

File and prosecute every insurance fraud brought to the unit by the Fraud Division that has a better than 50% chance of success.

The unit should not concentrate its efforts on major insurance frauds. Those can best be prosecuted by major fraud units already existing in the District Attorney’s offices and in offices of the US Attorney.

The state’s unit should concentrate on prosecuting every-day insurance fraud, the frauds of opportunity that take 90% of the money paid to fraud perpetrators, in the range of $5,000 to $50,000.

Single counts should be prosecuted. When prosecutors file multiple charges against individual defendants the case becomes a major action requiring a great deal of time to prosecute. Judges and juries do not want to be involved in a prosecution that takes months to prosecute.

If there are multiple counts available, the prosecutor should charge only the one where the evidence of fraud is overwhelming. If the jury finds for the defendant the prosecutor can charge the next count continuously until the statute of limitation runs.

If all available are charged in one case the prosecutor will offend the judge and jury and the defendant will get mercy from the jury. Overcharging prosecution is as bad as not charging at all.

Teeth must be put in the posters that say “commit insurance fraud, go to jail.” Departments of Insurance are receiving reports from insurers of thousands of potential fraudulent claims a month. They do not have the staff, the ability or the desire to investigate and prosecute every case brought to them. If only 5 percent of those claims are investigated and prosecuted to conviction, the deterrent effect will be enormous. The Department of Insurance should issue a press release concerning every arrest and conviction. Newspapers should report daily that insurance criminals have been arrested and are going to trial or were convicted and are going to jail. Jail sentences should be made mandatory and remove from local judges the right to grant convicted felons probation and restitution only.

Sentences across the state must be consistent and true punishment. I have seen such inconsistency where cases, after conviction, the criminals received sentences that ranged from 24 hours to 24 years.

It is not enough for the state to say that the insurance companies must investigate and work to fight fraud. The state must also aggressively and vigorously fight insurance fraud.

Today, a person perpetrating an insurance fraud need only be concerned that an aggressive fraud investigation might delay, or reduce, the amount he might recover from his crime. Criminal prosecution for the crime of insurance fraud is so minuscule, in relation to the amount of fraud, as to be nonexistent. It certainly does not act as a deterrent. In conjunction with the formation of a special insurance fraud prosecution unit in the attorney general’s office, the legislatures should enact the following statutes:

·         As of the effective date of this statute there is no tort of bad faith in this state.
·         Punitive damages may not be awarded in this state.
·         Any insurer that, without malice, reports to the Fraud Division, Department of Insurance that it has rejected a claim because of fraud may not be sued in any court of this state, for any tort cause of action.
·         This section is not intended to eliminate the right of any insured to sue its insurer for breach of the insurance contract.
·         If the legislatures really want insurers to fight insurance fraud; if the legislatures wish to keep strong and viable this important industry; if the legislatures want to reduce the insurance premiums paid by their constituents, they must make practical the war on insurance fraud. As long as the tort of bad faith and the exposure of punitive damages hangs over insurance companies, the war will be one of attrition where no one will win.

If enough people complain perhaps, the prosecution levels will increase. Although each of the stories in this book are based in fact, the names, locations and facts of the claims have been changed to protect the guilty. No resemblance to any person, except those specifically named, is intended and any resemblance is purely coincidental.

Zalma on Insurance Blog Posting

Help, My House Is Falling Into The Sea – A Fraud That Failed February 11, 2022
Failure to Fulfill Material Condition Defeats Claim for Defense or Indemnity February 11, 2022
Go Directly to Jail February 10, 2022
Issuance of an “Additional Insured Endorsement” Makes Policy Primary February 10, 2022
Zalma on Insurance Claims Third Edition – a Ten Volume Treatise February 9, 2022
Who’s Cheating Whom? Insurance Fraud Hurts Fraudster February 9, 2022
Clear & Unambiguous Exclusion Must Be Enforced February 9, 2022
Don’t Sweat the Small Fraud February 8, 2022
Go Directly to Jail, Do Not Pass Go February 8, 2022
The Sixth Volume of the Eight Volume Construction Defect Book Now in Second Edition February 7, 2022
True Crime Stories of Insurance Fraud – Number 13 February 7, 2022
Acceptance of an Offer of Judgment Resolves Litigation February 7, 2022
True Crime Stories of Insurance Fraud – Number 12 February 4, 2022
Mutual Rescission May be Eliminated by a Balance of Equities February 4, 2022
True Crime Stories of Insurance Fraud Number Eleven February 3, 2022
Insurance is a Contract of Personal Indemnity February 3, 2022
True Crime Stories of Insurance Number 10 February 2, 2022
Fraud by Licensed Paramedic & Criminal Conduct Can Result in Removal of License February 2, 2022
Zalma’s Insurance Fraud Letter – February 1, 2022 February 1, 2022

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.

Barry Zalma, Inc., 4441 Sepulveda Boulevard, CULVER CITY CA 90230-4847, 310-390-4455;

Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome. Write to Mr. Zalma at zalma@zalma.com; http://www.zalma.com; http://zalma.com/blog; I publish daily articles at https://zalma.substack.com.

Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma; Follow Mr. Zalma on Twitter at https://twitter.com/bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/ Read posts from Barry Zalma at Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/

Zalma’s Insurance Fraud Letter February 15, 2022

The Essential Resource for The Insurance Fraud Professional

Quote of the Issue

“Do Not Pray for An Easy Life; Pray for The Strength to Endure a Difficult One.”

Bruce Lee

Go Directly to Jail, Do Not Pass Go

Fraud by Insurance Company Officials

Insurance Education from Barry Zalma

Barry Zalma Presents What Your Insurance Organization Needs.

How Will You or Your Group or Organization Benefit from Working with Barry Zalma?

Live Training Available

Barry Zalma Presents What Your Insurance Organization Needs.

The Excellence in Claims Handling Program Will Cover:

The Insurance Examination Under Oath

A Tool Available to Insurers to Thoroughly Investigate Claims

Psychiatrist Sentenced to Only 120 Days for Falsifying Disability Reports

Milwaukee Pharmacy Chain to Pay Over $2 Million To Resolve False Claims Act Violations

Qui Tam Succeeds & Cardinal Health to Pay More Than $13 Million To Resolve Kickbacks Allegations

Psychologist Sentenced for Medicaid Fraud Scheme Involving Minors

Georgia Nurse Practitioner Convicted of Health Care Fraud in Complex Telemedicine Fraud Scheme

Fraudulent orders included knee brace for leg amputee

South Florida Man Sentenced To 15 Years for Consecutive Health Care Fraud Conspiracies

Doctor Sentenced for Illegal Drug Distribution and Health Care Fraud

Pharmacy Owner Sentenced To 2½ Years in Federal Prison For $14 Million Health Care Fraud Scheme

Vascular Surgeon Pleads Guilty in Connection With $19.5 Million Fraud

Catholic Medical Center Agrees to Pay $3.8 Million To Resolve Kickback False Claims Act Allegations

Western New York Optician Convicted for Medicaid Fraud

Woman Pleads Guilty to Insurance Fraud Involving Coachella Valley Cosmetic Surgery Center

North Carolina Psychologist Sentenced for Medicaid Fraud Scheme Involving Minors

Jennifer Faith Pleads Guilty to Murder for Hire in Husband’s Death

Guilty Again: Let Out of Prison Early so he Could Commit Arson & Insurance Fraud

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