Corrupt public adjuster Jorge Fausto Espinosa recruited dozens of homeowners via his firm, Nationwide Adjusters, in an insurance fraud plot where he inflated insurance claims to the tune of $14 million.
Espinosa paid marketers to lure homeowners with free kitchens and remodeling jobs if they allowed him to manufacture damage to their homes. He earned around 30% of the insurance payouts he lined up for the homeowners. Espinosa earned payouts of more than $317,000 at times.
Insurers were pushed to pay overblown insurance payouts from claims resulting from rigged fires to water damaged. Espinosa hit at least 14 insurers with more than 50 inflated claims. He was sentenced to 20 years in state prison for racketeering and insurance fraud among many other charges.
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According to investigators, Roderick Clark of Indian Harbour Beach is facing charges after filing a false claim for more than $30,000 in hurricane damages last year.
Clark claimed his home had sustained electrical damage during Hurricane Irma including having to replace 11 outlets and electronic devices that did not belong to him. According to court records, Clark also submitted a forged letter from an electrical company to USAA Insurance Co. stating that they made repairs in the about of $31,350.67.
Clark was arrested and charged with grand theft and insurance fraud.
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PropertyCasualty360 published a report about pending automobile personal-injury litigation in California and New York that could have a lasting impact if the decisions spread to other jurisdictions. Courts will determine allowable evidence for suits involving these insurance claims.
In New York, insurers investigated radiologist Andrew Carothers, a suspected illegal straw owner after he filed 20,000 lawsuits against auto-insurance carriers. After insurers refused to pay Carothers, he flooded the state’s courts with more than 20,000 lawsuits seeking collection for unpaid “services.” The civil cases were consolidated, and the jury agreed Carothers was fraudulently engaged in the corporate practice of medicine. The Appellate Division affirmed, so Carothers went to the New York Court of Appeals, where the case awaits a decision.
A favorable decision can deter scams like Carothers’ in other states that forbid the corporate practice of medicine. Fraudsters who often quickly expand operations to line their pockets in other states could be deterred. A decision is expected in 2019.
Dave Pebley was involved in a serious vehicle accident, sought medical care and filed suit. He had health coverage but decided not to submit his bills for payment. That is because, under California law, the jury would only hear about the amount paid by his health insurer as the measure of his medical expense while Pebley was billed at the top rate for medical services by refusing to use his health insurance.
The insurer cried foul, asserting that such actions mislead the jury, and are fraudulent because medical providers never expect to receive such high payments. They argued the plaintiff may present the higher medical bills but must provide expert testimony to prove the charges are fair and reasonable. Similarly, the defendant or their insurer may present counter-evidence as to what the health providers normally accept for payment of those services.
The California Second District Court of Appeal reasoned that juries should be allowed to ultimately decide the appropriate charge for the medical services. Parties are lining up to support an appeal of the case to the state Supreme Court. If Pebley succeeds in California, potentially winning the $3.6 million he seeks, the strategy of refusing to use health insurance can be expected to spread rapidly to other states.
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On Monday, July 10th, 14 people were charged in “Investigation Vehicle Roulette” conducted by Florida’s Bureau of Insurance Fraud and the State Attorney’s Office. Two GEICO insurance adjusters, Juan Carlos Diaz and Cesar Santiago Tapanes, prosecutors say got cash kickbacks for helping defraud their own company were among those arrested.
In September 2016, a Lexus GS350 was involved in a fender bender with a Chrysler 320 in North Miami-Dade. The rogue insurance adjusters reported inspecting the Lexus and authorized a series of payments totaling over $16,000. However, investigators say the accident never actually happened.
In fact, the same Lexus had been the subjection of 10 previous claims involving crashes that never occurred, all signed off by Diaz and Tapanes. The scam ended up costing GEICO more than a million dollars.
According to an arrest warrant by detectives, at least 45 bogus claims were made. The group faces charges including grand theft, insurance fraud, and racketeering.
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According to the Florida Department of Financial Services, Timothy Matthew Cox, owner of Nationwide Catastrophe Services, Inc. and Restoration Response Services, Inc., has been arrested for an alleged Assignment of Benefits (AOB) fraud scheme, stealing nearly $140,000 for home repairs due to tropical weather events that he never provided. Cox’s scheme impacted 19 homeowners throughout Florida and Texas, leaving the victims’ homes to sustain additional damage from other tropical weather events, including Hurricane Irma.
Cox’s team never started any of the work they were contracted to perform on the 19 homes after receiving insurance payments. He was arrested and booked into the Polk County Jail facing multiple counts of grand theft and racketeering. Cox could face up to 30 years in jail.
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Andrew Rubinstein of Miami and the self-confessed ringleader, Felix Filenger of Sunny Isles pleaded guilty to a racketeering conspiracy charge last year. Rubinstein and Filenger were paying kickbacks to tow truck drivers and body shop workers who illegally steered accident victims to chiropractic clinics they owned at a rate of $1,500 to $2,000 per “patient.” Clinic workers would then have patients attend multiple visits, document exaggerated pain levels, and bill insurance providers for treatment in the amount of $10,000, the maximum allowed under Florida law.
According to Prosecutors, the clinics were located throughout south and central Florida, including Sunrise, Hollywood, Hallandale Beach, Pompano Beach, Delray Beach, West Palm Beach, Miami, Orlando and Kissimmee.
Under the terms of his plea agreement, both sides had agreed to recommend the six-year sentence for Rubinstein. Filenger’s sentencing has been postponed. Several other people who also admitted their roles in the fraud are scheduled for sentencing later this year.
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According to the Ocala StarBanner, Kevin M. Day, 46, used forged documents to open an Allstate branch in Dunnellon. Day pleaded guilty to the fraudulent use of personal identification information of a former client.
Day used the personal information and forged documents signed in the name of a client of his former employer, saying the client would give Day $100,000 to start his own business. At least $100,000 in liquid assets is required by Allstate to open a business.
Day’s former boss investigated the situation and contacted Dunnellon police after Day first tried to buy her business, then opened his own Allstate branch. Day was sentenced to 24 months of probation, his insurance license is suspended indefinitely and he must complete 200 hours of community service.
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