Tag Archives: Operation Sledgehammer

Staged Accident Recruiter from Palm Beach County Sentenced to Nine Years

A West Palm Beach man, who participated in an $8 million insurance fraud scam, was recently sentenced to nine years in prison for his role in the matter.

Joel Antonio Simon Ramirez, about whom we reported on our FL PIP Guide in April, helped recruit individuals to participate in staged automobile crashes. According to a story in the Palm Beach Post, the 30-year old worked together with three other chiropractors who filed fake insurance claims for the participants in these crashes. They operated the scheme out of clinics throughout Palm Beach County.

Following a six-week trial in April, all four defendants were found guilty of money laundering and mail fraud. Ramirez was also found guilty of helping stage the auto accidents.

By violating PIP insurance provisions, these schemes not only cost insurers but also hurt Florida drivers, federal prosecutors said. The conspiracy was part of a larger staged accident ring dubbed “Operation Sledgehammer” by investigators who discovered that many participants damaged vehicles using sledgehammers to give the appearance of a crash.

Nearly 60 people have been charged in federal court and almost 40 have been charged in state court as part of this sweeping investigation. Most have pleaded guilty to participating in staged accidents and then seeking treatment for bogus injuries. According to prosecutors, the five ringleaders fled to Cuba.

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Operation Sledgehammer Finds Three Chiropractors Guilty of PIP Fraud

A federal jury has convicted one West Palm Beach chiropractor and two Miami chiropractors for their roles in a massive staged automobile accident scheme, following a seven-week trial in U.S. District Court for the Southern District of Florida.

Using the U.S. mail in a scheme involving Personal Injury Protection (PIP) payments, defendants were found guilty of defrauding insurance companies through mail fraud and money laundering.

Kenneth Karow, 54, of West Palm Beach, Hermann J. Diehl, 44, of Miami, and Hal Mark Kreitman, 50, of Miami Beach were all convicted on multiple counts. Karow was sentenced to 11 years in prison, Diehl to nine years, and Kreitman to eight years for the fraud scheme that ran from October 2006 through December 2012.

The fraud was perpetuated in several ways across 21 chiropractic clinics, according to a release issued by the U.S. Attorneys’ Office for the Southern District of Florida. Key elements of the scheme are outlined below.

  1. Licensed chiropractors were recruited to serve as the “named owners” of chiropractic clinics, in circumvention of Florida licensing requirements, with others actually in financial control of the business.
  2. Recruiters were used to attract real or fake auto accident victims who were fraudulently treated at the chiropractic clinics for injuries.
  3. False chiropractic treatment claims where then billed to insurance carriers.
  4. No co-pays or deductibles were collected from the “patients,” and this fact was not disclosed to the insurance companies.
  5. The money received from this scheme was then used to pay recruiters and participants and to enrich members of the conspiracy.

The prosecution is the latest in a series of charges that have been part of a four year investigation into the massive conspiracy. The joint federal and state investigation, known as Operation Sledgehammer, has resulted in charges against 93 defendants for their roles in the organization. Of these 93 defendants, 57 have been charged by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $11 million to defrauded insurance companies.

Click on the link to read the full release.

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Operation Sledgehammer Arrests another Staged Accident Recruit

Ricardo Pargas, 49, of West Palm Beach was arrested on Wednesday, September 24, 2014 for his participation in a staged auto crash ring, according to the Sun-Sentinel.

Acting on information from Allstate Insurance and the FBI, the Florida Division of Insurance Fraud discovered that Pargas and his wife had participated in a staged car crash while acting on directions from the fraud scheme’s ringleader, Alien Moya, 30, also of West Palm Beach. The couple, recruited by Moya, was paid $2,000 each for their part in the crash. As of this time it appears that Pargas’ wife has not been charged.

The crash at issue occurred on January 11, 2010 in West Palm Beach. Pargas and his wife were driving in a 2005 Ford pickup truck when they were intentionally rear-ended by a 1998 Chevrolet pickup driven by another participant in the scheme. A sheriff’s deputy responding to the scene reported that there were no injuries and that both drivers drove away.

Two days later, however, Pargas was being treated for injuries from the crash at Karow Chiropractic Center in West Palm Beach. The treatment center billed the insurance company $34,065, of which the company paid $19,386.25.

When interviewed by federal agents at his home on April 12, 2012, Pargas admitted to having been recruited by Moya to take part in the scheme. Pargas and his wife were instructed by Moya to undergo treatment at the Karow Chiropractic Center following the crash. They each visited the clinic twice a week, where they reportedly received massages and other treatments. Investigators pieced together their case against Pargas over two years, and he was booked into Palm Beach County Jail on Wednesday on a staged accident fraud charge.

Karow Chiropractic Center’s owner was convicted in April 2014 of conspiracy to commit mail fraud in connection with the staged crash.

Moya was arrested earlier this year by the FBI on separate federal charges of theft of an interstate shipment and selling stolen property after he and an accomplice were caught stealing the contents of a Walmart truck that they were hired to drive to a distribution center. At the time of the trucking theft in early February, Moya was out on bond while awaiting sentencing for his role in the Operation Sledgehammer staged accident fraud, according to an earlier Sun Sentinel article.

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Chiropractor & Receptionist Connected to Operation Sledgehammer Get Prison Sentences

Convicted for their role in a massive insurance fraud ring involving staged accidents in South Florida, two more people were sentenced in Operation Sledgehammer last week.

Chiropractor Lawrence Schechtman from Parkland, whom we reported about on our FL-PIP Guide on December 19 when he pleaded guilty to mail fraud conspiracy and mail fraud, was sentenced to four years and four months in federal prison. In addition to his sentence, he was ordered by U.S. District Judge Kenneth Marra to pay more than $2.4 million in restitution.

According to federal prosecutors, Schechtman worked at clinics in Palm Springs and Miami, where he signed off on treatments for people who fraudulently claimed they were accident victims as part of the staged-accident ring which operated in several counties.

According to a story in the August 8 Sun-Sentinel, the 45-year old Schechtman, who suffers from heart and back problems, was granted a request to serve his confinement at the Federal Medical Center, a medical prison in North Carolina. Judge Marra gave the chiropractor two months to turn himself in and begin serving his term.

Another co-conspirator from Palm Springs was sentenced for her role in Operation Sledgehammer. Sircy Sacerio, also known as Sisi or Sircy Santos, received four years in federal prison by Judge Marra.

Under the terms of her sentence, the Palm Beach Post reported, the 31-year old reception and office assistant must also repay $1,146,824.26 and will have two years of supervised release following her time in prison.

She originally pleaded guilty to one count of conspiracy to commit mail fraud and five counts of mail fraud.

Part of the fraud activity in Operation Sledgehammer, which was recorded by investigators, included co-conspirators damaging vehicles with sledgehammers to give the appearance of a crash. The participants in the staged accidents would then go to clinics involved in the ring to receive bogus treatment which, according to the U.S. Attorney’s Office, brought in millions of dollar to chiropractors on false and fraudulent insurance claims. The scheme began around October 2006 and continued through December 2012.

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Three Chiropractors Found Guilty of Federal Fraud Charges

Three Florida chiropractors involved in a plan to fraudulently obtain money from insurance agencies have been found guilty on federal money laundering and mail fraud charges.

The chiropractors—Hermann Diehl of Miami, Kenneth Karow of West Palm Beach, and Hal Mark Kreitman of Miami Beach—helped set up staged automobile accidents and then filed fake claims for “victims” of the crashes. They also billed insurance agencies for procedures that were not actually performed.

The verdict was rendered on April 22 by a jury in the U.S. District Court for the Southern District of Florida. A fourth defendant, Joel Antonio Simon Ramirez of West Palm Beach, was found guilty of helping to stage the accidents.

All four of the defendants were found guilty of money laundering and mail fraud, with sentencing set for July. They each face a maximum sentence of 20 years in prison.

Readers of FLPIPGuide.com may recall that we wrote about Dr. Karow in a May 17, 2013 post titled, “92 Accused in Staged Accident Fraud Ring, $20 million in Fraudulent Claims.” At that time, an Operation Sledgehammer investigation revealed that chiropractors Lazaro Rodriguez, then 58, of Doral, and Kenneth Karow, then 53, were recruited to serve as owners of clinics involved in the ring.

 

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Operation Sledgehammer I-VI Arrests Climb to 92

Six participants in a staged automobile accident ring that operated between October 2006 and December 2012 were sentenced this week by U.S. District Judge Kenneth A. Marra, according to the U.S. Attorney’s Office for the Southern District of Florida.

Almost $10 million in restitution is sought from the six leading defendants, along with jail time followed by three years of supervised release.  The individuals sentenced include:

Elias Sebastian Munguia, 41, Miami clinic owner
– $3,491,516.93 in restitution and 102 months in prison

Yenisleydi Ramos, 26, West Palm Beach secretary
– $1,666,028.08 in restitution and 50 months in prison

Oscar Montiel Martinez, 34, Lake Worth staged-accident participant, recruiter and check casher
– $1,359,208.73 in restitution and 76 months in prison

Teresita Mena, 52, West Palm Beach staged-accident participant, recruiter and check casher
– $1,321,459.87 in restitution and 66 months in prison

Aleida Capdevila, 62, West Palm Beach clinic office worker
– $1,039,928.19 in restitution and 53 months in prison

Juan Francisco Avon, 62, Miami licensed massage therapist
– $866,801.60 in restitution and 38 months in prison

Amaury Tomas Contino, 30, a Lake Worth staged-accident recruiter, filed a guilty plea in the matter. He faces up to 20 years in prison for each of multiple counts, including mail fraud.

The elaborate automobile insurance fraud scheme involved staged accidents, followed by unnecessary or fraudulent medical treatments at clinics run by participating owners, including defendant Munguia. False insurance claims for medical services not needed or never provided were submitted for payment.

The scheme grew as the “true owners” of chiropractic clinics recruited individuals with the medical or chiropractic licenses required by the state of Florida to establish new clinics and act as “nominee owners.”  Ultimately the network grew to include 21 clinics.

The scheme worked so well for a while that additional participants were hired to launder the stream of cash generated from the false claims.

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Parkland Chiropractor Pleads Guilty to Insurance Fraud in Staged Accident Ring

A Parkland chiropractor, who prosecutors said approved treatments for patients who fraudulently claimed they were victims of car accidents, pleaded guilty to five criminal charges in connection with an extensive staged-accident insurance fraud ring in South Florida, dubbed Operation Sledgehammer VI.

Court records show that Lawrence Schechtman, the 45-year old chiropractor who worked at clinics in Palm Springs and Miami, pleaded guilty to one count of mail fraud conspiracy and four counts of mail fraud, occurring between 2009 and 2012.

Co-conspirators in the scheme were found to have prescribed and bill for treatments that were unnecessary or never provided to the ‘victims’ who were sent to these clinics after the staged accidents. Complicit employees then submitted false claims to the insurance companies for payment.

According to an article in the Sun Sentinel on December 9, Schechtman is scheduled to be sentenced on March 3, 2014.  He could face time in prison and fines, in addition to paying restitution of between $1 million and $2.5 million.

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Three More Sentenced in Operation Sledgehammer

U.S. District Judge Kenneth A. Marra sentenced three more men involved in cases of staged car accidents to defraud insurance companies as part of Operation Sledgehammer, according to an article in the Sun Sentinel.

  • Luis Ivan Hernandez was handed down a sentence of nine years and ordered to pay $4.2 million in restitution. The 40-year old owned six clinics in Miami-Dade and Palm Beach counties, including one with girlfriend Maria Testa Baceiro. Testa was sentenced to six years, as reported in an October 4 post on FLPIPGuide.com.
  • Daviel Castro, authorities found, participated in the staged crashes, cashed checks and recruited others in the scheme. The 27-year old West Palm Beach man received a sentence of four years and 10 months in jail and will pay $1.3 million in restitution.
  • Aaron Freedlander, 51, a licensed chiropractor in Broward, was sentenced to three years and four months in prison. The Weston resident was ordered to pay a little more than $900,000.

According to federal prosecutors, each of the men had earlier pleaded guilty to conspiring to commit mail fraud. Hernandez and Castro also faced money laundering charges.

Court documents report that between approximately October 2006 and December 2012, those associated in the fraudulent scheme, including Castro, staged automobile accidents by recruiting individuals to take part. Then, clinic owners like Hernandez submitted false insurance claims through chiropractic clinics that were controlled by members of the conspiracy, authorities said.

Undercover agents christened the scheme ‘Operation Sledgehammer’ after they witnessed suspects using a sledgehammer to make vehicles appear like they had been in a car crash

So far, the operation has led to charges against 92 defendants in Broward, Palm Beach and Miami-Dade counties. Fifty-six have been charged federally and 36 by state prosecutors.

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Operation Sledgehammer VI Catches Two More in Staged Car Accident Scheme

Operation Sledgehammer, a federal investigation named for the preferred ‘tool-of-choice’ that conspirators used in an automobile insurance fraud scheme involving staged car accidents and fake insurance claims, has prevailed again over two more defendants.

U.S. District Judge Kenneth A. Marra handed down sentences to Maykel Marquez, 32, of Jupiter, and Noelia Marichal, 52, of West Palm Beach, for their connection to the fraudulent scheme. Each had previously pled guilty to one count of conspiring to commit mail fraud; in addition, Marquez pled guilty to multiple counts of money laundering.

A steady stream of court cases has revealed that between roughly October 2006 and December 2012, accomplices in the scheme, often referred to as “Perro” and “Perra” or “Macho” and “Hembra” by the conspirators, were recruited to participate in fake car accidents and launder insurance money.

According to court documents, the extensive scheme was carried out by chiropractic clinics controlled by members of the conspiracy. They recruited individuals, with necessary medical or chiropractic licenses, who could open a clinic and act as “nominee owners.” Conspirators also hired chiropractors and therapists willing to prescribe and bill for treatments that were unnecessary or never provided to the ‘victims’ who were sent to these clinic after the staged accidents. Complicit employees then submitted false claims to the insurance companies for payment. Once insurance money was received, additional accomplices laundered the insurance money.

Sentencing documents show that Marquez cashed checks worth $568,517.23, while Marichal cashed $101,344.26 to launder insurance proceeds.

Starting with Operation Sledgehammer I in June 2011 and including Marquez and Marichal, accused in Operation Sledgehammer VI, 92 defendants have been charged thus far for their participation, according to a news release issued by the FBI and U.S. Attorney’s Office-Southern District of Florida.

Of those 92 defendants, 56 have been charged federally by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $5 million to the defrauded insurance companies. Thirty-six defendants have been charged by the Palm Beach County State Attorney’s Office alone. In all, 21 clinics participated in this scheme.

Marquez was sentenced to 58 months, followed by two years of supervised release. He was ordered to pay $1,177,775.04 in restitution. Marichal received a sentence of 48 months, followed by two years of supervised release and $1,359,208.73 in restitution, the news release reported.

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Operation Sledgehammer Results in Sentencing of Ninth Person in Car Insurance Scam

A Miami woman, who helped manage a widespread car insurance fraud ring from her chiropractic clinic in West Palm Beach, has received a six-year sentence in connection with “Operation Sledgehammer.”

Maria Testa Baceiro, 29, who co-owned the clinic with her boyfriend Luis Ivan Hernandez, pleaded guilty to 48 charges, mostly related to money-laundering and fraud.  Hernandez also pleaded guilty to similar charges and will be sentenced on November 4.

According to prosecutors, Testa collected $4.2 million from Febre’s Medical Center on Forest Hill Boulevard, as well as Universal Rehab Med Group in Miami.  She is the ninth person sentenced as part of Operation Sledgehammer—a federal investigation named for a favored tool the fraudsters used to make millions in South Florida by staging car accidents and filing fake claims with insurance companies.

Of those linked to the scam, 40 have been arrested; however, some of the 92 indicted in June have fled primarily to Cuba to escape prosecution, according to a September 30 Palm Beach Post news article.

Testa and Hernandez also participated in fraudulent activity that operated out of other clinics in Palm Beach and Miami-Dade counties, but prosecutors have been unable to secure financial records in order to put a dollar amount on those losses, the news article said.

U.S. District Judge Kenneth Marra ordered Testa to pay $4.2 million in restitution.

Testa, who moved from Cuba to the U.S. as a teenager, apologized for her actions and agreed to testify against others in the case, hoping for a reduced sentence.  According to Testa’s attorney, her mother had to move from New York to raise Testa’s and Hernandez’s 3-year old son.  The judge allowed her to start her sentence December 2.

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