Author Archives: John A. Fregeolle, Esq.

Miami Woman Arrested and Charged in Insurance Fraud Scheme

According to the Palm Beach Post, Carmen Montalvo-Rivera of Miami was arrested and charged in Lake Worth, FL on Thursday, October 27th after investigators say she defrauded SUNZ Insurance Company. The arrest report states that Montalvo-Rivera’s shell company, Enterprises Remodeling Group Inc., used uninsured employers to do construction work. Once the job was finished, she would then cash the checks made out to the shell company in order to pay the workers in cash and severely underreport her company’s wages to the insurance company.

Montalvo-Rivera reported Enterprise Remodeling Group’s wages at $26,665 when they were actually $4,307,092.48. Her insurance premium should have been between $327,000 and $525,000 instead of the $1,796 premium she had been paying due to her fraudulent reporting.

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Filed under Florida, Insurance, Insurance Fraud, Miami-Dade County, Uninsured

GEICO Wins Sanctions Against Law Firm, Auto Repair Shop

GEICO won a sanctions request in Florida federal court against a Mississippi auto repair shop and its law firm. U.S. Senior District Judge Gregory A. Presnell ruled that GEICO’s Motion for Attorney Fees was “meritorious” and ordered the insurance company to prepare a specific fees request.

Clinton Body Shop and its law firm, John Arthur Eaves Attorneys, lost a summary judgment in a related suit charging GEICO with unjust enrichment and tortious interference with business relations. GEICO said that the summary judgment victory in that previous case barred the body shop from reasserting those same claims. The federal judge in the Middle District of Florida agreed.

“Any reasonable attorney or claimant would have known what is one of the most fundamental principles of our legal system: that a claim or issue, once litigated to a final adjudication, cannot be relitigated,” GEICO said in its motion. “(R)efiling of the same claims they lost to GEICO three months earlier in another case is automatically bad faith, warranting sanctions.”

Clinton’s argument was that the two suits involved separate entities: the first against GEICO Insurance Co., the latter against GEICO General Insurance.

The case is part of multidistrict litigation in which repair shops in 10 states are accusing several insurance companies of violating the Sherman Antitrust Act by colluding to keep reimbursement rates low for auto body repair work.

Presnell had dismissed Clinton’s claims against GEICO in May before granting sanctions on July 19.

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Filed under Florida, Insurance, Insurance Defense, Middle District of Florida

Mobile Ultrasound Owner Pleads Guilty in $29 Million Fraud

The owner of a mobile diagnostic ultrasound company pleaded guilty on June 21 to a nearly $29 million insurance fraud scheme.

Michelle Kobran, 68, admitted to falsifying medical bills and giving kickbacks to doctors at her chiropractic and physical therapy center in Wheeling, IL. Kobran said she altered the information on documents to get reimbursements from Blue Cross Blue Shield of Illinois, Aetna Health Insurance and other major insurance companies.

Law360 reported that for at least three years, Kobran had a deal with Vladimir Gordin Jr.

Kobran would do ultrasounds one day a week at Gordin Medical Center, and Kobran would pay Gordin one third of the bills she charged patients referred by the chiropractor. After Kobran realized insurance companies wouldn’t reimburse for multiple ultrasounds done on the same patient in the same day, she would change the dates of service on bills. Sometimes Kobran would tell her technician not to do all the ultrasounds ordered by doctors but charge for them anyway.

Kobran’s business submitted $28.8 million in fraudulent insurance bills over a six-year period ending in 2012 with insurance companies reimbursing those services for $10.8 million.

Kobran and Gordin were indicted in August 2015 along with three managers. Kobran’s plea includes her promise to testify against the others at trial in January. She faces 10 years in prison, but by testifying against the others she could end up with only two years in prison and $658,000 in restitution.

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Filed under Insurance Fraud, Medicare

Man Charged With Staging Traffic Accidents for Insurance Money

The Florida Division of Insurance Fraud arrested a man in Orlando who was charged with orchestrating automobile accidents for the purpose of defrauding insurance companies.

Alma Germain was accused of buying used junk cars to intentionally cause wrecks. Channel 9 in Orlando said one car was in such bad shape, Germain had to stop several times to add water to the radiator on the way to a staged crash.

Germain was charged with using cash to recruit people to get into crashes with him, then telling them to seek treatment at a local healthcare clinic. The clinic would then bill the insurance company.

In one particular case, Germain had three people in the car with him during a crash. He ran from the wreck site but told the three passengers to go to Family Practice and Rehab in Orlando for treatment. Family Practice billed the insurance company for nearly $25,000.

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Filed under Florida, Florida Division of Insurance Fraud, Insurance Fraud, Personal Injury Protection, PIP/No Fault

Pinellas County Court on Application of Deductible

In Bayfront Health Education & Research Organization Inc. v. Progressive American Insurance Co., the Plaintiff billed the Defendant for services. The Defendant reduced the bills, subtracted the insured’s deductible, and paid eighty percent of the difference. Under Florida Statute § 627.736, the Defendant pled that only reasonable, related, and necessary “medical expenses are reimbursable and likewise applicable to any deductible.” The Plaintiff moved for summary judgment claiming that the Defendant misapplied the deductible. The Plaintiff claimed that the deductible should be applied to the amount billed.

The Court held that Florida Statute § 627.739(2) “requires the deductible be applied to 100 percent of the reasonable expenses.”

The Court construed Florida Statute § 627.739(2) and Florida Statute § 627.736. Under Florida Statute § 627.739(2), “[t]he deductible amount must be applied to 100 percent of the expenses and losses described in s. 627.736.” The Court looked to Florida Statute § 627.736 “to determine the expenses and losses described.” The Court said that Florida Statute § 627.736 “describes the payable expenses as ‘reasonable expenses.’”

The Court also found that “the deductible is applied to 100% of all reasonable expenses” under the insurance contract.

The Court interpreted the insurance contract. Under the insurance contract, “the deductible will be applied to 100% of the expenses and losses covered under Personal Injury Protection Coverage.” The Court said that “[m]edical benefits are part of the Personal Injury Protection Coverage and defined as 80% of all reasonable expenses.”

In sum, under Florida Statute § 627.739(2), Florida Statute § 627.736, and the insurance contract, the Court held that “the deductible is applied to 100% of the provider’s reasonable expenses.”

Order Denying Plaintiff’s Motion for Summary Judgment, in Part, and Granting, in Part, Bayfront Health Educ. & Research Org. Inc. v. Progressive Am. Ins. Co., No. 12-5556-SC (Fla. Pinellas Cty. Ct. 2015).

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Filed under Fla. Stat. 627.736 (2012), FLA. Stat. 627.739(2), Florida, Insurance, Insurance Defense