Zalma’s Insurance

Fraud Letter

The Essential Resource For The Insurance Fraud Professional

A ClaimSchool ™ Publication, Written by Barry Zalma, Esq., CFE © 2017 ClaimSchool, Inc. & Barry Zalma

Volume 21, No. 24December 15, 2017

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Quotes of the Issue

“Christmas is a necessity. There has to be at least one day of the year to remind us that we’rehere for something else besides ourselves.”

Eric Sevareid

The miracle of Chanukah, of course, was not that the oil for the sacred light - in a little lamp- lasted as long as they say; but that the courage of the Maccabees lasted to this day: let that

nourish my flickering spirit.

Charles Reznikoff

Merry Christmas and HappyChanukah

A Christmas Fable of Fraud

ZIFL publishes this story at Christmas time every year. I hope you like it again.

[The story that follows is fiction based, in part, on a true case worked on by me. Any similarity to realpeople is unintentional. It is meant only to educate fraud professionals about how some unscrupulouspeople use the crime of insurance fraud for fun and profit during the Christmas season.]

Raymond Alexander had no religion. He cared only for himself and the money he could take from good-hearted people.

Raymond loved the Christmas season.

The marks were in such a kind and giving mood it wasn’t even work to take their money.

The Christmas before last Raymond stumbled on insurance fraud as a lucrative means of making quick, easy money.Raymond made a good living playing bunco schemes about town. He would work the money switch with old folks, thedip, and every possible scam invented to take money from honest people who had a little larceny in their hearts.

Because he was good at what he did Raymond lived well. He leased a three-bedroom apartment in the best part of town,drove a BMW sport sedan when he wasn’t working and purchased all of his suits from a custom tailor. He ate at gourmetrestaurants and collected an eclectic assortment of popular art dishes, Lladro figurines, and Tiffany Lamps.

Raymond, because he loved his collection, insured his home with the best and most expensive insurer hecould find. He had his dishes, figurines, and Tiffany Lamps appraised and scheduled on his policy so there was no dispute ifhe had to make a claim.

Last Christmas burglars entered Raymond’s home and stole two Lladro figurines and one art dish depicting the EnglishCountryside on Spode china. Raymond was upset that a burglar ripped him off. It was his profession to rip off others. Raymondfelt he now understood how women who had been raped must feel.

Raymond called his insurance agent and reported his claim. To his surprise his insurer telephoned him and asked what waslost. No one came to his home. No one asked to come to his home to investigate. They merely called on the telephone and

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asked for the number of the police report so the insurer could obtain a copy.

Such unthinking trust deserved to be made a victim of Raymond’s wiles. He, the consummate professional, could not resist the temptation. Hetold the person on the telephone that he was not sure what was taken and that he had only reported that which wasobvious on first inspection to the police. As a bunco artist of the first order what came next was simple: it was timeto create a major claim out of a small loss. The police officer had left him with a sheet of paper to list any items thathe later discovered were missing. Raymond sat at his oak and leather antique partner’s desk and prepared hissupplemental police report. On the report he listed one out of every four items on the insurance schedule. Then headded three Armani suits, two pairs of Ecco dress boots, a pair of Bruno Magli sport shoes, two pairs of goldcuff-links, and a simple Omega wrist watch. He was not greedy.

He sent the list to the detective and a copy to the adjuster who spoke with him on the telephone. Raymond expectedhe would need to haggle and would be forced to document each item to the insurance company. Much to his surprise,

two weeks later Raymond received a nice letter from his insurer. It advised him that the adjuster had calculated his loss, deducted $500 (hisdeductible) and could only pay $1,000 for the jewelry that was not scheduled because of a special limitation in the policy. The adjusterexpressed her regret in not being able to pay him for everything he lost and hoped the enclosed check for $135,650 would be satisfactory.

Since Raymond had only lost $375.50 worth of goods, the check was quite satisfactory and he spent the Christmas season in a comfortable resortin Bermuda.

When Raymond returned from Bermuda, he took the things he had reported stolen to high-end swap meets in Long Island, New York. He tradedone Lladro for another, one plate for another, two small Tiffany lamps for one large Tiffany Dragonfly lamp, and bought some new jewelry.

He called his appraiser, who updated the appraisal on his schedule by taking out the items claimed stolen and replacing them with the new itemshe had acquired and listed all of his jewelry. His policy was renewed and the schedule increased and changed to meet the new items with a valueof more than $1,150,000.00.

Raymond Alexander was not a greedy man. He was a successful confidence man because he was not greedy. He did not bleed his marks’ dry.He just took an adequate sum of money to properly support his accustomed lifestyle. Raymond never took everything the mark had. He wantedthe mark to know he was taken and to be too embarrassed to do anything about it.

Raymond looked on his insurance company as another mark. He did not want to collect $1,150,000 from them, only enough to take him throughthe holiday season that he had not celebrated since he was four-years-old.

It was time to have another loss and claim. A fire was out of the question, too messy and too much evidence would remain. Robbery wasdangerous and the person hired to fake a robbery might forget he was not supposed to really rob Raymond. A fake burglary might be worsebecause the police got testy about false police reports. He might make a mistake and they would learn the burglary was not real.

Raymond Alexander was successful at his chosen criminal profession because he paid attention to detail. He read his insurance policy. Partof that policy was a Personal Articles Floater that insured scheduled items for all risks of physical loss. It had very few exclusions. It covered,for instance, the Lladros, the Tiffanys, the jewelry and the plates against loss (with no explanation) or even breakage from any cause, includingan earthquake.

Raymond knew he could not cause an earthquake but he had no problem losing his scheduled items. He removed from hishome, two or three items at a time, for several weeks. Figurines and plates valued by his appraiser at $51,632.00 were storedat a Public Storage unit. Two of his twenty Tiffany lamps valued at $175,000 were next into the storage facility. The numberwas nice, odd and with no zeros except the cents.

On November 15 Raymond telephoned his insurance agent to report that he returned home from a weekend trip toConnecticut to his apartment in Boston and found selected parts of his collection missing. There was no evidence of abreak-in to his house and all he could explain to the agent was that the items had disappeared, mysteriously from his home.The alarm had been set and was operating perfectly. It detected no intruders but the items were gone.

Again, Raymond was contacted by an adjuster by telephone. He learned that she was in Phoenix, Arizona and never left her desk to deal withclaims. She asked for, and Raymond gladly gave, a recorded statement concerning the events and the items claimed lost. She kept him on thetelephone for almost an hour taking from Raymond as much detail as he could possibly remember about each item.

Raymond was distraught. His holiday had been ruined. The adjuster empathized with him and told him she would workhard to complete his claim before Christmas. She did. A check for $249,162.00 arrived in Raymond’s mail box onNovember 30. They broke a record by getting the money to him within a few weeks. They did no investigation other thanspeak to him, and they paid him promptly. Since the loss was his second loss in two years the adjuster sent a note to theunderwriters about the loss history and they decided not to renew Raymond for a second term.

He went to his insurance broker, after he “replaced” all the missing goods and obtained an identical policy from anotherinsurer for a smaller premium. They were willing to take a chance that lightning would not strike the same place threetimes in a row.

Raymond enjoyed his insurance company money and did less of his normal scams. It seemed wrong to take an oldwoman’s savings through a convoluted scheme when he could wrest money from an insurer with such ease. Thepayments also allowed him to add to his collection with no new spending.

Raymond was a happy man. His BMW had become boring to him. The state made him insure it so he had the best

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insurance money could buy from the New York Auto Insurance Specialists.

He drove the vehicle to Boston Harbor where it was shipped to an acquaintance with whom he had done a sting in Hartford who now lived inBelize. For a 15% commission the BMW was sold to a General in the Belize army for its high Blue Book value. Raymond then reported to theBoston PD and his insurance company that his BMW had been stolen from the street in front of his apartment while he slept.

Everything went well, the BMW was valued and the insurer was ready and willing to pay Raymond low blue book value on the car. They did,however, automatically report the theft to the National Insurance Crime Bureau (The “NICB”) who records the vehicle identification numberof every vehicle ever shipped out of the United States. The insurer was about to send a check to Raymond when it received a report from NICBthat the BMW had been shipped from Boston to Belize three months before.

The insurer assigned the investigation to its Special Investigation Unit. Investigator Steve Nazarian went to Raymond’s home to interview himin detail. Raymond lied with alacrity until he was confronted with the shipping documents. The ease with which he had been caught frightenedRaymond. He thought he might have to go to jail. He knew there was no way to take back the reported theft. It was a week before Christmas.He pleaded with Nazarian.

“Well, Mr. Alexander” Nazarian, responded, “the state of Massachusetts takes insurance fraud veryseriously. We are required to report you to the Insurance Fraud Bureau. They make all decisions aboutcrime. Your insurer, on the other hand, is quite upset that you tried to cheat it. What do you think weshould do?”

“Just forget I made the claim. I will sign any paper you ask to withdraw my claim. Getting me arrestedwon’t help you.” Raymond suggested.

“I just happen to have a release in my briefcase, here. Please sign it. I will report you to the IFB but I willalso report that we settled with you for no payment as I am required to do by law. They may have more important criminals to arrest than you.”

“Give me the release.” Raymond exclaimed as he grabbed the release out of Steve Nazarian’s hand and signed it. “Now please leave my house.”

“Of course, Mr. Alexander, and have a Merry Christmas.”

Raymond stayed at home through the Christmas season. He saw no one, did nothing. He ate a frozen turkey dinner alone on Christmas eve.He decided he would never attempt an insurance fraud again.

The Insurance Fraud Bureau had received, along with Nazarian’s report of Raymond’s attempted fraud, eighteen hundred reports of suspectedfraud for the month of November. His name was put in their data base for future reference but no file was opened. Bigger and more excitingfraud perpetrators took up their attention. No one was hurt. The insurance company paid no money and immediately cancelled all policies ithad for Raymond.

Raymond went back to his regular work taking money from widows, orphans, the sick and the partially criminal. He continued to live well andnever again committed insurance fraud. His Christmas present to the insurance industry was to set his criminal mind to other victims.

This is, of course, a Christmas Fable.

All insurers do not run auto thefts through the NICB or ISO database. Most insurers believe whatever the insured tells them. Most have under-trained, understaffed and overworked claims departments who just send out money.

Most insurance criminals, unlike Raymond, know about the lack of staff, how overworked and underpaid adjusters are, and would never signa release. The insurance criminal would either try to bribe the SIU investigator or sue the insurer for bad faith for having the gall to claim theycaught them at their crime. Insurance fraud perpetrators do not give up a chance of easy money just because their scheme did not hold together.

They change the scheme and bluster. Insurers, faced with an expensive defense, will pay something.Insurance criminals are not as naive as Raymond and insurers are not as bright and forceful as his insurer.Steve would never just give Raymond a release, he would need to consult with management (up at leastfour layers) and a lawyer before he took such a chance to defeat an insurance fraud.

Insurance fraud perpetrators, even if they feel they have been caught and will never recover, merelyredouble their efforts and perpetrate more frauds so they can make up for the few where they are caught.Raymond Alexander gave a Christmas present to the insurance industry but is still loose to take advantageof the old, the poor, and the weak who are prime candidates for a bunco artist. Insurers, unlike anoctogenarian widow, are better able to protect themselves from a bunco scheme.

The Christmas present I would like is a state government willing to prosecute every insurance fraud tothe limit of the law. I dream of an insurance industry willing to spend the money necessary to fight insurance fraud and make sure the fraudperpetrators are prosecuted and sued to regain any money paid.

Santa, this is what I want as a gift to me and the entire world: Governments and insurers willing to fight insurance fraud and give no quarterto the fraud perpetrator.

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“Insurance Law”

Quick Overview

Insurance Law is the most comprehensive, and yet practical, insurance law authority available today. Written by nationally-renowned insurancecoverage expert, consultant and blogger Barry Zalma, Insurance Law introduces the new insurance professional to thefundamental principles of insurance and provides the experienced litigator analyses of today’s leading insurance law decisionsnationwide.

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Fugitive Lawyer-Fraudster Captured

After Bribing Judges Failed Conn Pleaded Guilty & Then Escaped to Honduras

Eric C. Conn was arrested while leaving a restaurant in La Ceiba, Honduras, the Honduran news publication El Pais reported. Conn, a lawyerwas captured in Honduras after fleeing the United States to avoid sentencing for bribing an administrative law judge to obligate the governmentto pay more than $550 million in lifetime disability payments.

Police reportedly learned of Conn’s location after he connected to the restaurant’s wi-fi.

The FBI confirmed the arrest, which occurred after Conn ate at a Pizza Hut. Conn arrived in Lexington,Kentucky. On December 7, 2017 Conn pleaded not guilty to an escape charge in federal court.

News coverage of Conn’s court appearance did not refer to any issues with the arrest. A Justice Departmentpress release said Conn was arrested with assistance from the Agencia Tecnica de Investigaciones Criminalesde Honduras and the FBI’s Legal Attaché in San Salvador, El Salvador.

Conn’s lawyer told the press that if Conn hadn’t fled, he might have been able to reduce his 12-year sentenceto nine or 10 years and serve 85 percent of the total.

Now, Conn could face additional charges in the disability case. He had been indicted on 18 counts andpleaded guilty to only two of them—submitting false documents and bribing the judge.

Conn was sentenced to 12 years in prison in absentia in July, a month after he fled. One of his formeremployees, Curtis Lee Wyatt, has been charged with helping Conn escape by opening a bank account for himand buying him a truck.

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Conn was accused of paying more than $600,000 to the judge, David Black Daugherty, who pleaded guilty and was sentenced to four yearsin prison. Another judge, Charlie Paul Andrus, was convicted for conspiracy to retaliate against a former employee who provided informationto investigators. He was sentenced to six months in prison.

Claimants illegally waltzed home with more than $550 million of payments for fake or inflated injuries thanks to the flamboyant Kentuckylawyer. It was one of the biggest such heists in U.S. history. Conn worked federal disability claims for people in the impoverished Kentuckyand West Virginia coalfields. The Pikeville man marketed himself as “Mr. Social Security.” He bribed an administrative judge $10,000 a monthto rubber-stamp disability claims in more than 1,700 cases. Conn also paid off docs, a clinical psychologist and others to help him slide phonyclaims through the system. They signed medical reports saying healthy claimants were disabled. Conn also forged medical forms before patientevaluations took place. Conn earned more than $5.7 million, lived in a mansion and traveled around the world. He pleaded guilty, then slippedout of his monitoring device and bolted the U.S. He was sentenced to 12 years in federal prison, in absentia. The criminal cases have delayedpayments to Conn’s truly injured clients. Most clients have valid disability claims even if Conn cheated on their applications, they say. Newcharges involving his bolting could amount to a life sentence.

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Insurer Failed With the Aid of a Disbarred Lawyer

Insurer Should Never Hire an Insurance Fraud Convicted Felon

The public thinks that insurance companies have an unlimited amount of money and never fail. They are wrong. Insurance companies fail often,especially when they are operated by people without an active moral compass.

Galen Insurance Company decided that the best way to become profitable was to hire a disbarred lawyer who hadjust been released from jail after pleading guilty to insurance fraud charges.

Dennis Lowry of St. Louis, Missouri, alleged in his 2016 wrongful termination suit that the Galen InsuranceCompany broke the law by doing business with Howard Wittner after Wittner’s release from federal prison in2014. Wittner was disbarred in 2013 after he pleaded guilty to two counts of making false statements intended todeceive insurance regulators, and to willfully permitting a felon to engage in the insurance business. Wittneradmitted lying to state regulators and concealing the source of money used to buy a medical malpractice insurer.

Wittner was sentenced to three years in prison but was released from a federal facility in Kentucky in October 2014after about nine months because he was deemed terminally ill with a life expectancy of 18 months. Wittner was

released on probation and ordered to pay $10.5 million in restitution.

St. Louis County Circuit Judge Ellen Levy approved the confidential settlement November 27, 2017 in her chambers with only lawyers for bothsides present.

In the latest criminal activity National Prearranged Services and its affiliated insurance companies looted trust accounts, took unauthorizedloans on customers’ insurance policies and lied to regulators to enrich company officials and pay expenses. Several top executives went to prisonfor the scam.

Lowry alleged in his suit that Galen executives hosted an “out of prison party” for Wittner to celebrate his early release and soon hired him towork in Galen’s law office, from which Wittner’s sons Greg and Kirk Wittner, both lawyers, provided counsel to Galen.

According to the lawsuit, Galen continued doing business with Howard Wittner for 10 more months after Lowry alerted CEOGeorge Schoedinger that employing an ex-convict violated federal law.

Lowry was fired Aug. 13, 2015, because he cooperated with a state investigation into Wittner’s involvement with the company,his suit claimed.

In a separate lawsuit against Lowry, Galen claimed Lowry tried to gain control of the business and secretly tried to sell the firmto investors who would remove Schoedinger as CEO, ultimately resulting in tensions that led to Lowry’s termination. Galenalso accused Lowry of stealing the company’s confidential financial data but later dismissed the suit.

In June, a Cole County judge declared Galen insolvent and ordered it to begin liquidating its assets. Galen Insurance Company(“Galen”) was ordered liquidated on May 31, 2017 by the Cole County Circuit Court when it entered a Judgment, Decree andFinal Order of Liquidation, Case No. 17AC-CC00005. Chlora Lindley-Myers, and her successors as Director of the MissouriDepartment of Insurance, Financial Institutions and Professional Registration was appointed Liquidator.

Galen was organized as a Missouri corporation on December 8, 2004, for the purpose of providing medical malpracticeinsurance to physicians, medical professionals and stand-alone surgical centers on a claims-made basis (Certificate ofIncorporation I00626573,NAIC #12361). Galen was first licensed as a property and casualty insurance company in Missouriunder Chapter 379, RSMo by the Department on December 14, 2005. Galen was authorized to do business in six states: Illinois, Kansas, Florida,

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Maryland, Missouri, and New Jersey, but it only wrote policies in Illinois, Maryland, Missouri, and New Jersey. Existing policies terminatewithin 30 days from the date of the Judgment. Claims are now handled by the state guaranty associations in accordance with each state’sguaranty association statute.

The company was established in 2004 to offer medical malpractice insurance policies to doctors, medical professionals and surgery centers.

Since the settlement was made confidential and the insurer had been declared insolvent, it is not known who paid what to whom.

Wisdom

“All journeys have secret destinations of which the traveler is unaware”. — Martin Buber

“Where there is no law, there is no liberty; and nothing deserves the name of law but that which is certain and universal in its operation uponall the members of the community.” — Benjamin Rush

“Surround yourself with the best people you can find, delegate authority, and don’t interfere.”“ – Ronald Reagan

“You will succeed if you persevere, and you will find a joy in overcoming obstacles, a delight in climbing rugged paths, which you wouldperhaps never know if you did not sometime slip backward.” – Helen Keller

“Personal security and private property rest entirely upon the wisdom, the stability, and the integrity of the courts ofjustice.” — Joseph Story

“What counts is not necessarily the size of the dog in the fight -- it’s the size of the fight in the dog.” – Dwight D.Eisenhower

“The group consisting of mother, father and child is the main educational agency of mankind.” —Dr. Martin LutherKing Jr.

“The difference between genius and stupidity is that genius has its limits.” – Albert Einstein

“The object of war is not to die for your country but to make the other bastard die for his.” – George S. Patton

“It is clear that thought is not free if the profession of certain opinions make it impossible to earn a living.” — Bertrand Russell

“There is no greater mistake than to try to leap an abyss in two jumps.” – David Lloyd George

Barry Zalma

Barry Zalma is the principal of Barry Zalma, Inc. He is available for consultation on any and all insurance issues faced by you oryour clients.

Barry Zalma founded the firm to help resolve every insurance claim problem faced by you or your clients. His experience and skillas a consultant can make the difference before a jury or other trier of fact. For more than 45 years as a claims person and insurancecoverage attorney, Barry Zalma has represented insurers, advised insurers on claims handling, interpreted coverages and testifiedas an insurance coverage, insurance bad faith, insurance claims handling and insurance fraud expert on behalf of insurers and policy

holders’ suing insurers.

Mr. Zalma has been rated “AV Preeminent” and is an internationally recognized expert on insurance, insurance claims handling, insurancecoverage, insurance fraud, and insurance bad faith. Barry Zalma will promptly review your file materials and advise you about the viabilityof your decision to sue or your defenses. He can help you narrow the scope of discovery.

Consultation with Mr. Zalma can save you or your client thousands of dollars in the defense or prosecution of an insurancedispute. Mr. Zalma will assist you in the effort to find a solution to an insurance claims dispute that is fair, intelligent,beneficial and economical.

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Mr. Zalma’s rates are all inclusive. Mr. Zalma’s hourly fee takes account of all incidentals from telephone calls and postage.

Insurance Fraud Investigation in Official Capacity

is Immune From Suit

Eleventh Amendment Rules

No one likes to be investigated as the perpetrator of insurance fraud. This became very clear in Robert Amatrone, et al. v. Eric Winkler, et al,Case No. 17-cv-03003-JST, United States District Court Northern District Of California (November 20, 2017).

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INTRODUCTION

On May 24, 2017, Plaintiffs filed suit against the California Department of Insurance (CDI) and Eric Winkler, a “Sergeant” with CDI. Plaintiffsclaim that Winkler and various law enforcement officials conducted an illegal search of their home on March 26, 2014.During the search, Plaintiffs allege that Winkler planted evidence “to build a criminal insurance fraud case againstRobert Amatrone.” Plaintiffs also allege that Winkler interrogated Plaintiff Sharlow, threatened her, and confiscatedher property. In addition to these facts specific to Defendants CDI and Winkler, the Complaint contains multipleallegations relating to the other officials present during the search. (e.g., “Approximately 10 to 15 armed officers withassault rifles and guns entered the home and held plaintiff Marla Sharlow at gun point.”)

Plaintiffs allege three causes of action. First, Plaintiffs “claim damages under 42 U.S.C. § 1983 for the injuries set forthagainst Defendant Winkler.” Second, Plaintiffs assert a false imprisonment claim against Defendant Winkler. Third,Plaintiffs assert a section 1983 claim against CDI for maintaining “policies or customs exhibiting deliberate indifferenceto the constitutional rights of persons in the State of California which caused the violation of Plaintiff’s rights.”Defendants CDI and Winkler moved to dismiss and the Plaintiffs did not file an opposition to the motion.

ANALYSIS

Section 1983 Claims

Defendants’ first ground for relief is that Plaintiffs’ claims are barred by the Eleventh Amendment to the United States Constitution. “[I]n theabsence of consent a suit in which the State or one of its agencies or departments is named as the defendant is proscribed by the EleventhAmendment.” The same is true for a suit against a state official in his or her official capacity, which is not a suit against the official but ratheris a suit against the official’s office. Accordingly, all claims against the California Department of Insurance and against Eric Winkler in hisofficial capacity are dismissed without prejudice to Plaintiffs’ right to seek any available relief in state court. This finding does not apply toPlaintiffs’ claims for “prospective injunctive relief,” or to Plaintiffs’ claims against Eric Winkler in hispersonal capacity.

Those section 1983 claims that are not barred by the Eleventh Amendment were filed after the applicablestatute of limitations had expired. The statute of limitations for section 1983 actions is governed by thestatute of limitations for personal injury actions in the forum state. In California, for conduct occurringafter 2003, that statute of limitations is two years. In this case, the allegedly wrongful conduct occurredon March 26, 2014, yet Plaintiffs did not file suit until May 23, 2017. Plaintiffs’ remaining section 1983claims were dismissed as untimely. Plaintiffs may file an amended complaint to include tollingallegations.

False Imprisonment Claim

After dismissal of Plaintiffs’ section 1983 claims, only Plaintiffs’ state law false imprisonment claim remains. The Court declined to exercisesupplemental jurisdiction over Plaintiffs’ false imprisonment claim.

CONCLUSION

The Court dismissed with prejudice Plaintiffs’ section 1983 claims for damages against Defendant CDI and Defendant Winkler in his officialcapacity. The Court dismissed without prejudice Plaintiffs’ section 1983 claims for prospective injunctive relief and against Defendant Winklerin his personal capacity.

ZIFL OPINION

This lawsuit seems to be an angry response to a complete investigation that eventually resulted in the arrest of the plaintiff. Although the statelaw false imprisonment case remains the U.S. District Court refused to keep the case and allowed the plaintiff to return to state court. If, in fact,the raid was conducted with armed individuals it seems that there was clearly sufficient evidence for the probable cause needed to conduct theraid. Seems the whole action was frivolous. It makes clear the difficulty faced when investigating and charging insurance fraud.

Good News From the

* Dr. Salomon Melgen stuck needles in patients’ eyes and burned their retinas with lasers in a $136-million Medicare ruse. Useless or

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bungled treatments left some patients blind. Many tests and treatments were “reckless,” an expert testified at the South Florida eye doc’s trial.Melgen also exposed patients to potential infections and other risks. Anna Borgia got painful injections andlaser treatments for supposed glaucoma and diabetes-related sight loss. He then botched a surgery that left hernearly blind. She said she’s confined to her home, listening to the TV and depending on paid drivers to takeher to the grocery store. Melgen convinced a 90-year-old woman to undergo laser treatments and injectionsthat she later learned were unneeded because she has no eye disease. Melgen’s 1-in-13 infection rate forinjected patients was “astronomically high,” an expert testified at his trial. The normal rate is 1 in 3,300.Melgen faces up to life in federal prison when sentenced.

* An airplane crash con tail spun out of control. Theodore Robert Wright and 3 cronies wrecked planes, and damaged a yacht andLamborghini Gallardo for fat insurance paydays. The East Texas man and his cohorts brought the stuff and insured them for more than theirvalue. They wrecked a 1966 Beechcraft Baron … 2008 Lamborghini Gallardo … 1971 Cessna 500 … and 1998 Hunter Passage luxury sailboat.Wright set up an emergency landing of the Beechcraft Baron in the Gulf of Mexico. It sank in deep water and wasn’t recovered. He claimed$85,000 — double what he paid. The Lamborghini Gallardo crashed into a ditch full of water, causing the vehicle to flood. The Cessna 500was ruined when Raymond Fosdick set it on fire at Wright’s direction at an airport in Athens, Tex. The Hunter Passage sank in a marina inHawaii. False insurance claims were filed for each. The group also filed a bogus $1-million personal-injury lawsuit for the Beechcraft crashin the Gulf of Mexico. They settled for $100,000. Wright is the last to plead guilty. He’ll spend up to 20 years in federal prison for wire fraudand arson.

* Back surgery left postal worker Deborah Durand totally disabled, the Great Falls, Mont. woman claimed. Durand hauled in more than$683,000 in workers-comp money. Then investigators got nosy and sent her on a 3-day kayak trip that confirmedher scam. The probe started when investigators found Durand was feeding horses, lifting hay bales, jogging in themorning, and removing tree stumps at her home. Investigators set up a sting. Posting as a marketing firm, they sentDurand a fake survey. Kayaking and camping were among her favorite outdoor activities, she said in the survey.Congrats! Durand won a free kayaking trip around San Juan Island off the coast of Washington State. The tripincluded kayaking 4-7 hours a day, totaling about 12 miles. Agents went on the trip to gather evidence. The outingwas easy because “I’m fairly strong,” Durand said in a followup survey. She’s also fairly guilty. Durand received15 months in federal prison.

* Richard Klaffka slouched in a wheelchair for 10 years, bluffing his way to $1.2 million in disability money. Klaffka said he was injuredin the military, and was confined to the wheelchair. Federal disability money flowed his way. The feds started tracking Klaffka. They saw himdrive up to the local VA office, leave the car, then lift and open his wheelchair without help. His wife wheeled him into the office. Witnessessaw Klaffka hunting, riding a bicycle, chopping wood and playing horseshoes. An anonymous call to a fraud hotline started the investigation.“I blamed the government for my misfortune,” Klaffka said. “I decided I would make it my business to get as many benefits as possible fromthe government.” The feds returned the favor, handing Klaffka 32 months in prison. His wife Cathleen received 3 years of probation.

* Sharp-eared claims reps felled a Cleveland construction worker’s bogus injury claim. Christopher Gattarello said a work injury earnedhim payouts from the Ohio Bureau of Workers’ Compensation. Yet BWC claims reps heard loud construction noises in the backgroundwhenever they phoned Gattarello about his injury claim. The reps told BWC investigators, who quickly took down Gattarello. He worked asa driver/heavy equipment operator while illegally receiving BWC benefits. Gattarrello earlier received 57 months in prison for ordering thedemo of an asbestos-stuffed building. The work released harmful toxins into the air near several homes and a school.

* After mismanaging a golfing club, Keven Robert Fitzgerald faked the theft of solar panels so insurancemoney would help keep the place afloat. Fitzgerald ran the Roddy Ranch Golf Club in Antioch, Calif. Hebroke some of the club’s solar panels and lied that 300 were stolen. The insurer paid $267,000. Fitzgeraldspent some of the money on the club; he and a crony split the rest. Fitzgerald also stole $200,000 of an$800,000 loan intended to install the panels. He kept telling investors that they were making money, thoughhe faked the club’s books. That was the last dagger for the flailing club. It closed in 2016, costing 25 peopletheir jobs. Fitzgerald’s freedom closed as well; he received 3 years in county prison.

* Chicago-area chiros Steven Paul and Bradley Mattson were being probed for billing an insurer $3.65million for unneeded and phantom treatments. They required patients to get an initial X-ray, then pre-arranged

6-month schedules of clinic visits whether or not the patients needed the work. So an undercover FBI agent visited a clinic, complaining of backstrain. Mattson diagnosed the agent with a pinched nerve and ordered a treatment plan that began with daily visits for 2 weeks. All this despitethe clinic’s doctor and a physical therapist saying the agent actually suffered from a pulled muscle. Paul now suffers from a 20-month federaljail term. Mattson received more than 6 years in 2012.

* A logging firm’s comp con was treed. David C. Sigl was hurt as a heavy-equipment operator for a Syracuse, N.Y. logging company.He claimed he was totally disabled, and received nearly $83,500 in workers-comp money. All the while Sigl ran his own logging firm. He wascaught climbing in and out of a large log-skidder tractor, wielding chainsaws, and hoisting himself up and down trees. Sigl also illegally didn’tprovide comp coverage to his own employees. He received up to 1-3 years in prison. The court cited Sigl’s long list of drunk driving and theftconvictions dating back to 1980. Sigl also committed several crimes out of state and violated his probation.

* Lettuce packers were packed off to prison for duping their employees and workers-comp insurer. Jaime Rosario Del Real and son Israelran firms that contracted farm labor for picking and packing lettuce for growers in California and Arizona. The Del Reals concealed injuriestheir workers sustained, and refused to pay for medical treatment or comp coverage. They also lied about how many workers they had in orderto reduce their comp coverage. The pair kept 2 sets of state employment forms listing differing numbers of workers. They received 2 years injail and must repay more than $382,000, the California insurance department announced.

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* A judge counseled a counselor that he’ll spend more than 2 years in federal prison to get his head together.George E. Compton ran a psychology practice in Coldwater, Mich. He built relationships with patients by providinglegitimate and periodic counseling. Then he’d regularly bill the patients’ health plans for counseling that “grosslyexceeded” the actual number of sessions. Compton billed a patient’s insurer for 100 counseling sessions for kids whileproviding only 8 sessions. He billed for another patient who was in a coma. Compton claimed problems with billingsoftware when insurers questioned bills, and reimbursed the insurers to avoid suspicion. He created fake patient noteswhen another insurer nosed around.

* Medicare fraudsters secretly abused Miami-Dade state courts for years in a $63-million plot. The groupcoordinated with criminal defendants in the court system. Ring members helped them avoid prison by securing courtorders for mental-health treatment. They also recruited patients from assisted-living facilities, halfway houses and drug courts in South Florida.The defendants were referred to a community mental-health center — Greater Miami Behavioral Healthcare Center. The outfit then billedMedicare for outpatient psychiatric services. The patients often didn’t need care or qualify for services. Patient recruiters received kickbacksand bribes for referrals. The center disguised the bribes. Patient brokers were placed on the center’s payroll. They received a flat monthly rate,and bonuses for high-billing referrals. The kickbacks were labeled “outreach” or “marketing” payments. Eleven ring members have pleadedguilty so far.

* Andrew Payne was crossing a street in the UK, minding his business. A speeding Fiat-500 plowed into him, tossing him into the air. DriverAdam McDermott whizzed off, leaving Payne to die. Payne survived life-threatening injuries, and surveillance video captured the collision inunruly detail. The horrific video went viral, and McDermott had little defense at trial. He had no insurance, so his then-partner Robyn Burnsburned the car and told the insurer that someone stole it. McDermott received 6½ years in prison, and Burns 80 hours of community servicefor insurance fraud.

* A city commissioner bled Blue Cross Blue Shield by moonlighting as a marketer for a dishonest pharmacy in a $1.7-million scam. OscarElizondo was a leader for Pharr City in South Texas. He also pulled in employers that carried coverage from the Blues. He offeredmeals and drinks to entice employees to turn over their insurance info. Free prescription pain patches and scar creams also weredangled. Elizondo’s cohorts used the insurance info to make fraudulent claims for treatments the employees never received. Otheremployees were sent to a doc who received kickbacks, including cash, loans and prescription drugs. Elizondo also set up a temporaryoffice for the doctor in a vacant office and a rented recreational vehicle where they solicited employees to write fraudulentprescriptions. Elizondo could spend 10 years in federal prison when sentenced early next year.

* Jeffrey Scholes was severely hurt when he got into a collision with Stephen Hausmann in South Orange, N.J. Scholes sued Hausmann.Except for one problem: Scholes lives and works in New Jersey, and keeps his car there. Yet he illegally shaved his Geico auto premiums bypretending he was a Floridian. He registered his car in the Sunshine State, and has a Florida driver license. The judge dismissed Scholes’ suitin Essex County Superior Court. New Jersey requires its drivers to have New Jersey auto insurance. Scholes violated that law — and the state’sfraud law forbidding dodging auto premiums by faking residence in another state. His insurance scam meant he was uninsured. Scholestechnically had coverage, he argued. He technically was a lawbreaker, the judge shot back. Scholes is appealing. The Coalition advisedlawmakers in drafting New Jersey’s auto premium-evasion law, and testified in support of the bills.

California Division of Workers’ Comp Suspends 21 More Medical

Providers for Fraud

The California Division of Workers’ Compensation has suspended 21 more medical providers from participating in the state’s workers’compensation system, bringing the total number of providers suspended this year to 115. The providers were suspended for fraud or othercriminal actions.

The suspensions were made possible by the passage last year of Assembly Bill 1244, which requires the DWCadministrative director to suspend any medical provider convicted of a crime involving fraud or abuse of the Medi-Calor Medicare programs or the workers’ comp system, a patient, or related types of misconduct.

DWC Administrative Director George Parisotto issued suspension orders against the following providers:

• George Samuel Laing of Long Beach, manager and operator of Pacific Clinic, was convicted in federal courtin 2013 of multiple counts of health care fraud for his involvement in a fraudulent Medicare billing scheme.

• Augustus Ohemeng, Buena Park physician, was convicted in federal court in 2013 of multiple counts of healthcare fraud for his involvement in a Medicare billing scheme.

• George Tarryk, Long Beach physician, was convicted in federal court in 2013 of one count of health carefraud for his involvement in a fraudulent Medicare billing scheme.

• Emmanuel Chidueme of Anaheim, owner and operator of DME company Ivy Medical Supply, was convicted in federal court ofhealth care fraud, sentenced to 37 months in federal prison and was ordered to pay restitution.

• Sang Ahn, Los Angeles recruiter, was convicted in federal court of conspiracy to commit health care fraud.

• Yeong Ja Lee of Los Angeles, employee of home health care provider Greatcare Home Health, was convicted in federal court in

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Sonjay Fonn

2014 of conspiracy to commit health care fraud.

• Edward Bui Hai, Highland physician, had his medical license revoked this year after the MedicalBoard of California’s decision that the provider is unable to practice medicine safely due to disablinghearing loss, visual impairment and probable dementia.

• Cesar Antonio Banda, Fair Oaks physician, had his medical license revoked this year for prescribingcontrolled substances to multiple patients without examination or medical indication.

• Margaret Mary Haggerty, Tracy physician, had her medical license revoked this year due to a mental and physical illness thatimpairs her ability to safely practice medicine.

• Kiansi Blaise Boni, Torrance physician, had his medical license revoked this year for gross negligence and repeated acts of negligencein his treatment of a patient

• Ariel Eliahou Abrahams, Los Angeles physician, had his medical license revoked this year for failure to comply with the terms ofprobation imposed by the Medical Board of California following prior disciplinary proceedings.

• Frederick Michael Silvers, Los Angeles physician, had his medical license revoked this year for prescribing controlled substancesto patients with histories of substance abuse without clinical support.

• Sacha Comden, Santa Monica physician, had her license revoked this year for violating the terms of her probation imposed by theMedical Board of California.

• Thomas Michael Ehlinger, Ojai physician, had his medical license revoked this year following the stipulated surrender of his medicallicense from the state of Washington.

• Alfred D. Trotter, Jr., Chula Vista physician, had his medical license revoked this year for gross negligence, failure to diagnose andfor performing surgery without appropriate medical indication.

• Daniel Cham, Alhambra physician, was convicted in 2016 in federal court of charges related to the distribution of oxycodone andmoney laundering. His medical license was revoked in 2016 for conduct leading to his conviction.

• John Anthony Flores, Mission Hills physician, had his medical license revoked in 2016 following the suspension of his New Mexicomedical license on the grounds that his continued practice of medicine posed a clear and immediate danger to public health and safety.

• Emilio Joseph Miranda, Los Angeles physician, had his medical license revoked in 2016 for failing to comply with an order fromthe Medical Board of California compelling him to submit to a mental and physical examination.

• Hrayr Karnig Shahinian, Los Angeles physician, had his medical license revoked in 2016 foradvertising untrue and misleading information to patients by overstating his training andqualifications.

• Hossain Sahlolbei, Blythe physician, was convicted of grand theft in Riverside in 2016. Hismedical license revocation proceeding is pending before the Medical Board of California.

• Charles Roy Phillips, Fresno physician, had his medical license revoked in 2014 due to a mentalillness that affects competency.

AB 1244 requires the DWC administrative director to suspend any medical provider, physician, or practitioner from participating in the workers’comp system in cases in which any of the following is true: They were convicted of a felony or misdemeanor involving fraud or abuse of theMedi-Cal or Medicare programs or the workers’ compensation system, fraud or abuse of a patient, or related misconduct; they were suspendeddue to fraud or abuse from the Medicare or Medicaid programs; or the provider’s license to provide health care has been surrendered or revoked.

ZIFL can only wonder what took the state as much as four years to suspend some of these medical providers. ZIFL commends the state forkeeping out of the system these less than qualified health care providers from working on injured workers.

Health Insurance Fraud Convictions

Neurosurgeon and his Fiancee Liable for Kickback Fraud

Sonjay Fonn and fiancee Deborah Seeger were found liable to the United States of submitting false and fraudulentMedicare and Medicaid claims. Federal prosecutors a judge to order the Cape Girardeau, Missouri neurosurgeon topay $6.53 million in penalties and “treble damages” as part of the final sentence.

Prosecutors filed the 14-page motion late last week in federal court. Citing federal law, prosecutors seek triple theamount of damages imposed by a federal jury.

On November 9, 2017, a jury in St. Louis handed down guilty verdicts against Fonn and his medical practice, MidwestNeurosurgeons LLC, and Seeger and her company, DS Medical LLC, following an 11-day civil trial.

Seeger started DS Medical, a spinal-implant distributorship in 2008. Fonn then used spinal implants from DS Medicalfor most of the spinal-implant surgeries he performed from 2008 to 2012.

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Deborah Seeger

Trial evidence showed that after Seeger received a fifty percent commission, she spent some of that income to benefit Fonn through homeimprovements, purchase of a yacht and other “purchases and expenditures”.

Federal prosecutors alleged the defendants and their corporations violated the anti-kickback statute, a federal law thatbars health-care providers from making patient referrals in exchange for any direct or indirect benefits.

The jury found Fonn and Seeger conspired to violate the federal False Claims Act.

Prosecutors said in their motion the judge statutorily is required to impose three times the amount of damages for suchviolations.

In addition, prosecutors said they are seeking the “minimum amount of per-claim penalties or $5,500 for each of the223 claims,” or a total of $1.22 million. That amount plus treble damages adds up to a total judgment of $6.53 million,according to the motion.

The federal suit began as a civil case brought by a handful of Cape Girardeau doctors and two others in 2012.

Cape Girardeau physicians Terry Cleaver, Kyle Colle, Scott Gibbs (now deceased), Paul Tolentino and KevinVaught, surgical assistant Daniel Henson and Cape Girardeau resident Paul Cairns filed a civil suit in federal court five years ago againstFonn and Seeger and their medical companies regarding kickback allegations.

In a 2012 court filing, it was alleged Fonn and Seeger had an “exclusive arrangement” that resulted in large profits for the defendants.

In 2014, the government intervened in the civil suit, essentially taking over prosecution of the civil case.

That same year, a federal grand jury handed down a four-count criminal indictment accusing Fonn and Seeger of one count of conspiracy tosolicit and receive illegal kickbacks and three felony counts of anti-kickback violations.

The indictment accused Fonn of altering his medical practice to include more surgeries than usual and to use more spinal implants in thosesurgeries during the time DS Medical was operating.

In December 2015, U.S. Magistrate Judge Abbie Crites-Leoni dismissed the criminal case against Fonn and Seeger at the request of prosecutors.

Although fines and damages are important, this type of crime requires prison time. Why the prosecutors asked that it be dismissed is a matterof wonder and concern.

School Counselor Sentenced To Two Years In Prison For Defrauding North Carolina Medicaid

Joseph Frank Korzelius, 47, of Tryon, N.C. was sentenced November 30, 2017 to 24 months in prison for fraudulently billing Medicaid formore than $450,000 in false claims for mental and behavioral health services he did not provide, announced R. Andrew Murray, U.S. Attorneyfor the Western District of North Carolina. In addition to the prison term imposed, U.S. District Judge Martin Reidinger ordered Korzelius toserve three years of supervised release and to pay $436,229.08 as restitution to Vaya Health, the administrator of Medicaid funds in WesternNorth Carolina.

According to court documents and the sentencing hearing, from October 2013 to November 2016, Korzelius, a licensed professional counselorand a Medicaid-approved provider of mental and behavioral health services, owned and operated Western CarolinaCounseling Services, located in Tryon. Korzelius was also employed as a school guidance counselor at TryonElementary School in Polk County. According to court records, Korzelius identified students and their siblings fromhis work at Tryon Elementary and used those potential beneficiaries’ information to access these individuals’ personalinformation. The defendant then used that information to create and submit billings for individual psychotherapyservices when, in fact, no such services were provided.

Court documents show that Korzelius had minimal documentation to support his billings for services he fraudulentlyrepresented that he provided. Further, many recipients who Korzelius billed for indicated they never sought orreceived services from either Korzelius or Western Carolina Counseling Services. Filed court documents show thatKorzelius controlled the bank accounts where the Medicaid approved reimbursements were deposited. During thecourse of his scheme, Korzelius submitted over $450,000 in false claims and received $436,229.08 in reimbursementsfor those fraudulent claims.

Korzelius pleaded guilty to one count of health care fraud. He will be ordered to report to the Federal Bureau ofPrisons to begin serving his sentence, upon designation of a federal facility. All federal sentences are served without

the possibility of parole.

Dermatologist Pays $850,000 To Settle False Claims Act Allegations

Skin Care Doctors, P.A. and its CEO allegedly engaged in improper Medicare billing

Skin Care Doctors, P.A. and its founder and CEO, Michael J. Ebertz, M.D. have agreed to pay $850,000 to the United States to resolveallegations of false claims submitted for certain dermatology procedures in violation of the False Claims Act (“FCA”).

The United States contended that between January 2008 and December 2015, Skin Care Doctors, P.A. (“SCD”) and Michael J. Ebertz, M.D.(“Ebertz”) submitted false claims for payment to the Medicare Program. The billing in question spanned four different areas, including billingMedicare for free samples of a phototherapy drug and upcoding office visits, lesion removal procedures, and phototherapy services. As outlined

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in the settlement agreement, Ebertz and SCD will pay to the United States a settlement amount of $850,000.

The settlement resolves a civil lawsuit brought by a whistleblower, a doctor who formerly worked with Ebertz, under the qui tam provisionsof the False Claims Act. The False Claims Act allows private parties to bring suit on behalf of the government for false claims and to sharein any recovery. Such whistleblowers bring fraud schemes to light that might otherwise go undetected.

Physician Agrees To Pay $1.95 Million to Resolve Fraud Charges

Dr. Arthur S. Portnow, the owner and operator of Arthur S. Portnow, P.A., d/b/a Apple Medical andCardiovascular Group, d/b/a Apple Medical Group (collectively, Dr. Portnow) has agreed to pay $1.95 millionto resolve allegations that he and his practice violated the False Claims Act by knowingly seeking reimbursementfor medically unnecessary ultrasound tests that were performed on Medicare beneficiaries.

The government alleges that from August 2009 through August 2017, Dr. Portnow submitted fraudulent claimsto Medicare for the evaluation and performance of medically unnecessary carotid ultrasounds, lower extremityarterial ultrasounds, abdominal aortic ultrasounds, renal and renal artery ultrasounds, and echocardiograms. Thegovernment also alleges that Dr. Portnow falsified patient records in an effort to justify those unnecessaryultrasounds. Dr. Portnow and his practice received hundreds of thousands of dollars as a result of this illicit testing.

In addition to paying the $1.95 million, as part of the settlement, Dr. Portnow has also agreed to enter into an integrity agreement with theInspector General of the U.S. Department of Health and Human Services.

The settlement concludes a lawsuit originally filed in the United States District Court for the Middle District of Florida by a former employee(Kathleen Siwicki) of Dr. Portnow’s practice. The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Actthat permits private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows thegovernment to intervene and take over the action. Ms. Siwicki will receive roughly $350,000 of the proceeds of the settlement with Dr. Portnow.

Podiatrists Plead Guilty To Fraud

William Danzeisen (60, Ponte Vedra Beach, Florida), a licensed podiatrist, and Sachin Brahmbhatt (37, Jacksonville, Florida), an unlicensedpodiatrist, have pleaded guilty to theft of government property. Each faces a maximum penalty of 10 years infederal prison. The sentencing hearings have been set for January 30, 2018.

According to the plea agreement, Danzeisen and Brahmbhatt owned and operated Nourish Foot Care, a medicalspa and mobile podiatric service that provided podiatry services to residents of long-term care facilities acrossnortheast Florida. They defrauded Medicare by billing for medical services not rendered by a licensed podiatrist.Since Brahmbhatt was an unlicensed podiatrist, he was unable to bill Medicare.

Danzeisen billed Medicare representing that he had performed podiatry care when the care had been provided byBrahmbhatt. Since 2015, $121,537.50 in false and fraudulent claims were submitted to Medicare.

Michigan Home Health Agency Convicted in $1.6 Million Healthcare Fraud Scheme

Editha Manzano, 69, of Troy, Michigan, was convicted of one count of conspiracy to commit health care and wire fraud, one count ofconspiracy to pay and receive kickbacks in connection with Medicare beneficiaries, and one count of health care fraud following a seven-daytrial. Sentencing has been scheduled for April 19, 2018, before U.S. District Judge Gershwin Drain of the Eastern District of Michigan, whopresided over the trial.

A federal jury found Manzano, a Detroit home health agency owner, guilty today for her role in a scheme involving approximately $1.6 millionin fraudulent Medicare claims for home health services that were procured through the payment of kickbacks, and that were medicallyunnecessary and not provided.

According to evidence presented at trial, from 2013 to 2016, Manzano and her co-conspirators engaged in a scheme todefraud Medicare of approximately $1.6 million in fraudulent claims for home health care services in connection withAnointed Care Services, a Detroit area home health care agency (Anointed). The evidence showed that Manzano paidillegal kickbacks for patients to sign up for home health care with Anointed. The evidence further showed that Manzanoconspired with physicians to admit patients for home health care with Anointed when they did not qualify for such services. To make it appear that these patients did qualify, Manzano and her co-conspirators falsified medical records and signedfalse documents purporting to show that patients admitted to Anointed’s home health program satisfied Medicare’srequirements for admission, the evidence showed.

Five defendants were charged in this matter. Liberty Jaramillo, 67, of Troy, Michigan, pleaded guilty in June 2017 and is awaiting sentencing. Dr. Roberto Quizon, 71, of Bloomfield Hills, Michigan, pleaded guilty in June of 2017 and is awaiting sentencing. In addition, Dr. VictoriaGallardo-Navarra, 74, of Bloomfield Hills, Michigan was acquitted after trial and Juan Yrorita, RN, 63, of Sterling Heights, Michigan, pleadedguilty during trial and is awaiting sentencing.

Hospital to Pay $7.5 Million to Settle Allegations of Paying Kickbacks

Pine Creek Medical Center LLC (“Pine Creek”), a physician-owned hospital serving the Dallas/Fort Worth area, has agreed to pay $7.5million to resolve claims that it violated the False Claims Act by paying physicians kickbacks in the form of marketing services in exchange

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for surgical referrals, the Department of Justice announced today.

The government alleged that, between 2009 and 2014, Pine Creek engaged in an illegal kickback scheme wherebythe hospital would pay for marketing and/or advertising services on physicians’ behalf and, in return, thephysicians would refer their patients, including Medicare and TRICARE beneficiaries, to Pine Creek. Amongother things, Pine Creek allegedly paid for advertisements on behalf of the physicians in a number of local andregional publications. Pine Creek also allegedly paid for radio and television advertising, pay-per-click advertisingcampaigns, billboards, website upgrades, brochures, and business cards, as well as other forms of marketing toinduce physicians to refer patients to Pine Creek for medical services.

As part of the settlement, Pine Creek has agreed to enter into a corporate integrity agreement with the Departmentof Health and Human Services Office of Inspector General (HHS-OIG), which obligates the defendants to undertake substantial internalcompliance reforms for the next five years.

The settlement resolves allegations originally brought in a lawsuit 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. The whistleblowers, Suzanne Scott andSavannah Sogar, former employees of Pine Creek’s marketing department, will receive $1,125,000.

“Pill Mill” Doctor Pleads Guilty to Drug Distribution, Health Care Fraud, and Money Laundering

Dr. Gilberto Sanchez, 56, of Cecil, Alabama, on Tuesday, November 28, 2017, pleaded guilty to drug distribution conspiracy, health carefraud, and money laundering charges.

According to court documents, beginning on an unknown date and continuing until he was arrested on August 1, 2017, Dr. Sanchez operateda “pill mill” through Family Practice, a medical clinic he owned located at 4143 Atlanta Highway in Montgomery, Alabama. A “pill mill”is a medical clinic that is dispensing controlled substances inappropriately, unlawfully, and for non-medical reasons. At Family Practice, Dr.Sanchez conspired with other health care providers working for him to prescribe controlled substances to patients even though they did notactually need the medicines. Among the controlled substances Dr. Sanchez and his colleagues unnecessarily prescribed were oxycodone,hydrocodone, methadone, hydromorphone, amphetamine, and fentanyl.

As for the health care fraud charge, the court documents indicate that Dr. Sanchez and his colleagues requiredpatients of Family Practice to return for monthly physical examinations before the patients could receiveprescription refills. Such monthly examinations were not medically necessary, as the patients had no realmedical condition that required the prescribing of controlled substances in the first place. Dr. Sanchez andthe Family Practice employees would then bill health insurance companies and government health insuranceprograms (including Medicare and Medicaid) for the cost of these unnecessary monthly examinations.

The money laundering charges stem from Dr. Sanchez’s spending the proceeds of his operation of a pill mill. Court documents describe Dr.Sanchez using those proceeds to purchase at least one vehicle and one personal residence located in Montgomery.

Dr. Sanchez’s sentencing date has not yet been set. At sentencing, he faces a maximum of 20 years in prison on the drug conspiracy count andmaximum sentences of 10 years imprisonment on the health care fraud and money laundering counts. There is no parole in the federal system.He also faces substantial monetary penalties, restitution, and forfeiture of assets purchased with the proceeds of his crimes.

Woman Faces Prison for Forged Prescriptions

Felicia L. Prysock, age 41, of Wellford, South Carolina, pled guilty to Aggravated Identity Theft, a violation of Title 18, United States Code,§ 1028A; and, Obtaining a Controlled Substance by Fraud, a violation of Title 21, United States Code, § 843(a)(3). Chief Judge Terry L. Wootenpresided at the hearing and will sentence Prysock on February 27, 2018.

Evidence presented at the change of plea established that Prysock filled ten different prescriptionsforged in the names of her children and had Medicaid pay for them. The conduct occurred between July2016 and April 2017. The investigation revealed that these prescriptions were for Schedule II opioids,such as oxycodone, hydrocodone, and Adderall.

U.S. Attorney Drake stated the statutorily mandated penalty faced by Prysock for a violation of Title18, United States Code, § 1028A is imprisonment for two years, with a potential fine up to $250,000.The maximum penalty for a violation of Title 21, United States Code, § 843(a)(3) is four years in prison

and a fine of $250,000.

School Counselor Sentenced To Two Years In Prison For Defrauding North Carolina Medicaid

Joseph Frank Korzelius, 47, of Tryon, N.C. was sentenced to 24 months in prison for fraudulently billing Medicaid for more than $450,000in false claims for mental and behavioral health services he did not provide, announced R. Andrew Murray, U.S. Attorney for the WesternDistrict of North Carolina. In addition to the prison term imposed, U.S. District Judge Martin Reidinger ordered Korzelius to serve three yearsof supervised release and to pay $436,229.08 as restitution to Vaya Health, the administrator of Medicaid funds in Western North Carolina.

According to court documents and the sentencing hearing, from October 2013 to November 2016, Korzelius, a licensed professional counselorand a Medicaid-approved provider of mental and behavioral health services, owned and operated Western Carolina Counseling Services, locatedin Tryon. Korzelius was also employed as a school guidance counselor at Tryon Elementary School in Polk County. According to court records,

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Korzelius identified students and their siblings from his work at Tryon Elementary and used those potential beneficiaries’ information to accessthese individuals’ personal information. The defendant then used that information to create and submit billings for individual psychotherapyservices when, in fact, no such services were provided.

Court documents show that Korzelius had minimal documentation to support his billings for services he fraudulently represented that heprovided. Further, many recipients who Korzelius billed for indicated they never sought or received services from either Korzelius or WesternCarolina Counseling Services. Filed court documents show that Korzelius controlled the bank accounts where the Medicaid approvedreimbursements were deposited. During the course of his scheme, Korzelius submitted over $450,000 in false claims and received $436,229.08in reimbursements for those fraudulent claims.

Korzelius pleaded guilty to one count of health care fraud. He will be ordered to report to the Federal Bureau of Prisons to begin serving hissentence, upon designation of a federal facility. All federal sentences are served without the possibility of parole.

15 Months for Workers’ Compensation Fraud

Deborah Durand was sentenced November 30, 2017 in U.S. District Court to 15 months in prison forfraudulently obtaining more than $683,000 in wages, medical expenses and other benefits from the U.S.Department of Labor from 2006 until 2016.

For about 10 years, a former U.S. Postal Service employee had claimed “total disability” after a backsurgery and subsequently received more than half a million dollars in worker’s compensation benefits.During that time, she also took part in a three-day kayaking trip with undercover federal agents testingthe validity of her disability claims.

Additionally, Durand, 55, was ordered to pay more than $900,000 in restitution and criminal forfeiture.

According to the U.S. Attorney’s Office, Durand suffered a back injury while at her job at the U.S. Post Office and later had back surgery. Asa result, she was unable to work for a period of time, but instead of returning to work when physically ready, she filed for total disability status.

As time went on, agents with the U.S. Postal Service Office of Inspector General began collecting evidence that Durand was feeding horses,lifting hay bales, jogging in the morning, removing stumps from fallen trees, and other physical activities at her home in Montana.

According to court documents, agents sent Durand a fake survey in December 2014. On the returned survey, she had listed kayaking andcamping as part of her outdoor activities. Agents contacted Durand in April, 2015, posing as members of a marketing company, saying she hadwon a free kayaking trip.

In July of that year, agents went with Durand on a three-day, two-night kayaking tour in the area of San Juan Island off the coast of WashingtonState. The trip included kayaking for about four to seven hours a day, totaling about 12 miles.

In a follow-up survey, Durand reportedly said the physical demands of the trip were not difficult because “I’m fairly strong.”

Durand was indicted in May 2016 for fraudulently obtaining employee’s compensation, wire fraud, false claims relating to worker’scompensation benefits and theft of government property. She was convicted at the end of a three-day bench trial in August, with U.S. DistrictJudge Brian Morris presiding.

Durand was sentenced to 15 months in federal prison for each count, with each count running concurrently.

Flower Shop Owner Guilty of Fraud

Cynthia Ann Smith, 60, the former owner of Cindy’s Flowers and Gifts in Menlo Park, California onDecember 1, 2017 was ordered to pay more than $131,000 in restitution to various people and agencies,following a no contest plea to felony charges of insurance fraud and unemployment insurance fraud in August.

The plea came on the condition that she not serve time in state prison, and she was sentenced Oct. 19 to 90 daysin county jail, starting on or after Dec. 16, and five years of supervised probation.

According to prosecutors, on Thursday, Nov. 30, she was ordered by Judge Barbara J. Mallach to pay restitutionof $131,168 to the following:

• $61,783 to FTD Flowers, a floral and gifting company.

• $41,187 to the California Employment Development Department.

• $14,200 to James Waldschmidt, a former coworker.

• $13,998 to State Farm Workers Compensation.

According to prosecutors, Ms. Smith was paying her employees under the table in cash and failed to renew her workers’ compensation insurancepolicy, which was canceled because the premiums were not paid. Pay deductions for state and federal taxes were not being made, and sheallegedly did not pay some employees at all.

Illinois Chiropractor Gets 20-Month Prison Term

Steven Paul of Northbrook, Illinois, pleaded guilty to one count of health care fraud. Paul, a suburban Chicago chiropractor has been sentenced

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to 20 months in prison for billing an insurance company more than $4 million for treatment that was unnecessary or never provided.

U.S. District Court Judge Rondald Guzman said during a sentencing hearing in Chicago he was imposing theshortest prison term possible because of Paul’s “extraordinary cooperation” in the investigation.

Paul and co-defendant Bradley Mattson of Lake Forest jointly owned six chiropractic clinics north of Chicago.Both admitted in plea agreements they required patients to receive x-rays and a pre-set schedule of visits even ifthey weren’t medically necessary.

Mattson was sentenced in 2012 to six and a half years in prison.

Another Montgomery “Pill Mill” Doctor Pleads Guilty

Dr. Shepherd A. Odom, 78, of Alexander City, Alabama, pleaded guilty on Friday, December 8, 2017, to charges of drug distribution andconspiracy to commit money laundering. Dr. Odom’s guilty plea was a part of the ongoing investigation and prosecution of those involved inoperating a “pill mill” through the Family Practice medical office located at 4143 Atlanta Highway in Montgomery, Alabama.

According to court documents, until 2013, Dr. Odom was a part owner of Family Practice. In 2013, he sold his interest in the business to hispartner, Dr. Gilberto Sanchez, who recently pled guilty to drug distribution, health care fraud, and money laundering charges arising out of

the same scheme. After selling his ownership interest in Family Practice, Dr. Odom remained involvedin the business’s affairs. For example, records show that in 2014 Dr. Odom issued an illegitimate andunnecessary prescription for fentanyl patches to a patient. Additionally, in or about 2013, Dr. Odomagreed with Dr. Sanchez and others to launder the proceeds of the practice’s drug distributionoperations. The money laundering was accomplished by Dr. Sanchez frequently issuing sizable checksfrom the practice’s bank account that were payable to Dr. Odom.

On March 22, 2018, Dr. Odom is scheduled to be sentenced in federal court where he faces up to 20years on each count. Dr. Odom also faces substantial monetary penalties and restitution.

Sentenced in Absentia to 80 Years in Prison for Involvement in $13 Million Medicare Fraud

Ebong Tilong, 53, of Sugarland, Texas, was sentenced by U.S. District Judge Melinda Harmon of the Southern District of Texas. In November2016, after the first week of trial, Tilong pleaded guilty to one count of conspiracy to commit healthcare fraud, three counts of healthcare fraud,one count of conspiracy to pay and receive healthcare kickbacks, three counts of payment and receipt of healthcare kickbacks, and one countof conspiracy to launder monetary instruments. In June 2017, Tilong pleaded guilty to two counts of filing fraudulent tax returns. Tilong failedto appear for his original sentencing, which was scheduled for Oct. 13, 2017.

Tilong, the owner of a Houston home health agency was sentenced December 8, 2017 to 80 years in prison for his role in a $13 million Medicarefraud scheme and for filing false tax returns.

According to the evidence presented at trial and Tilong’s admissions in connection with his guilty plea, from February 2006 through June 2015,Tilong and others conspired to defraud Medicare by submitting over $10 million in false and fraudulent claims for home health services toMedicare through Fiango Home Healthcare Inc. (Fiango), owned by Tilong and his wife, Marie Neba, 53, also of Sugarland, Texas. Thetrial evidence showed that using the money that Medicare paid for such fraudulent claims, Tilong paid illegal kickbacks to patient recruitersfor referring Medicare beneficiaries to Fiango for home health services. Tilong also paid illegal kickbacks to Medicare beneficiaries forallowing Fiango to bill Medicare using beneficiaries’ Medicare information for home health services that were not medically necessary or notprovided, the evidence showed. Tilong falsified medical records and directed others to falsify medical records to make it appear as though theMedicare beneficiaries qualified for and received home health services. Tilong also attempted to destroy evidence, blackmail a witness, andsuborn perjury from witnesses, including a co-defendant while in the federal courthouse, the evidence showed.

According to the evidence presented at trial and his admissions to the tax offenses, from February 2006 to June 2015, Tilong received morethan $13 million from Medicare for home health services that were not medically necessary or not provided to Medicare beneficiaries.

In connection with his guilty plea to the tax offenses, Tilong admitted that to maximize his gains from the Medicarefraud scheme, he created a shell company called Quality Therapy Services (QTS) to limit the amount of tax thathe paid to the IRS on the proceeds that he and his co-conspirators stole from Medicare. According to his pleaagreement, in 2013 and 2014, Tilong wrote almost a million dollars in checks from Fiango to QTS, purportedly forphysical-therapy services that QTS provided to Fiango’s Medicare patients. The evidence showed that QTS did notprovide those services. According to his plea agreement, in 2013 and 2014, Tilong’s fraudulent tax scheme causedthe IRS a tax loss of approximately $344,452.

To date, four others have pleaded guilty or been convicted based on their roles in the fraudulent Medicare schemeat Fiango. Nirmal Mazumdar, M.D., of Houston, Texas, the former medical director of Fiango, pleaded guiltyto a scheme to commit health care fraud for his role at Fiango. Daisy Carter, 58, of Wharton, Texas, and ConnieRay Island, 49, of Houston, Texas, two patient recruiters for Fiango, pleaded guilty to conspiracy to commit healthcare fraud for their roles at Fiango. Neba was convicted after a two-week jury trial of one count of conspiracy tocommit health care fraud, three counts of health care fraud, one count of conspiracy to pay and receive health carekickbacks, one count of payment and receipt of health care kickbacks, one count of conspiracy to launder monetary instruments and one countof making health care false statements.

On Aug. 11, Neba was sentenced to 75 years in prison and Island was sentenced to 33 months in prison. On Oct. 3, Mazumdar was sentenced

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to time served with three years of home confinement. Carter is awaiting sentencing.

37 Months in Prison for Taking Bribes for Referring Tests to New Jersey Clinical Lab

Jorge J. Figueroa, 59, of Wayne, New Jersey, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to accepting bribes.Judge Chesler imposed the sentences December 6, 2017 in Newark federal court. Figueroa, an internal medicinedoctor with a practice in West New York, New Jersey, was sentenced to 37 months in prison for accepting bribesin exchange for test referrals as part of a long-running scheme operated by Biodiagnostic Laboratory Services LLC(BLS), of Parsippany, N.J., its president and numerous associates.

According to documents filed in this case and statements made in court Figueroa admitted that he had acceptedchecks, cash and other bribe payments totaling approximately $200,000 from BLS employees and associatesbetween May 2007 and April 2013. In exchange, Figueroa generated more than $1.4 million in lab business forBLS.

The investigation has thus far resulted in 51 convictions – 37 of them doctors – in connection with the briberyscheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100

million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medicalprofessionals ever prosecuted in a bribery case.

The investigation has to date recovered more than $13 million through forfeiture. On June 28, 2016, BLS, which is no longer operational,pleaded guilty and was required to forfeit all of its assets.

In addition to the prison term, Judge Chesler sentenced Figueroa to one year of supervised release and fined him $7,500. He must also forfeit$199,899.

ZIFL can only wonder why so many doctors, who honestly can make exceptional earnings, feel compelled to commit fraud to steal from theUnited States and its taxpayers. The only reason I can conceive is that such fraud is more often than not successful and highly profitable andthe arrest, prosecution, conviction and sentencing of the physicians is rare and not sufficient to act as a deterrent.

Seven Ohio Convictions

The Ohio Department of Insurance reported that five people were recently sentenced for insurance-related crimes following investigations bythe department.

Clermont County/Shandell Thomas and Aaron Thomas

In October, Shandell Thomas, of Cincinnati, was sentenced in court to five years of community control and ordered to pay $12,215 inrestitution to five insurance companies. In November, her husband Aaron Thomas received a community control sentence of five years, alsofor insurance fraud. The couple submitted false medical invoices to insurance companies related to an auto insurance claim.

Licking County/Vernisha Shepherd-Harris

In November, Vernisha Shepherd-Harris, of Pataskala, was sentenced in court to two years of communitycontrol for insurance fraud. She submitted $3,488 in false medical bills to an insurance company as partof an auto insurance claim.

Scioto County/Lisa Chamberlin

In November, insurance agent Lisa Chamberlin, of Lucasville, was sentenced in court to five years ofcommunity control for insurance fraud and ordered to pay more than $5,000 in restitution to an insurancecompany. She provided fabricated insurance applications to the company to receive commission money.

Lucas County/Trivia Wilson

In November, Trivia Wilson, of Toledo, was sentenced in court to three years of community control for attempted insurance fraud and orderedto pay restitution. Wilson submitted $11,845 in fictitious receipts to an insurance company tied to a property loss insurance claim.

Ernest Shawn Baker of Pomeroy, Ohio was ordered to reimburse the Columbus, Ohio-based workers’ compensation bureau more than $23,000after investigators found him working several jobs while collecting injured worker’s benefits.

Mr. Baker also must serve five years of community control after pleading guilty to a fifth-degree felony count of workers comp fraud last monthin the Franklin County, Ohio, Court of Common Pleas, the bureau said in the statement.

Mark McIntosh, 51, of Millfield, Ohio, in addition, pleaded guilty last month in a Franklin County, Ohio, courtroom to a first-degreemisdemeanor count of workers comp fraud after investigators found him working again for “cash under the table.”

A judge fined Mr. McIntosh $100, then suspended it, and declined to order restitution because of McIntosh’s age and financial situation,according to the statement.

ZIFL can only wonder why Ohio courts hand out such merciful sentences for insurance fraud where five convictions resulted in no jail time.These sentences are not deterrents to future people considering insurance fraud. If anything, they encourage others to try since they profit ifnot caught and have little or no punishment if they are caught.

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Fuller

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Other Insurance Fraud Convictions

Former railroad executive sentenced to 5 years in state prison

Gordon Fuller, 77, of Plainfield, New Jersey, was sentenced by Superior Court Judge Salem Vincent Ahto inMorristown following an Oct. 17 conviction on charges of second-degree conspiracy, insurance fraud and attemptedtheft by deception, and a fourth-degree charge of falsifying or tampering with records. Fuller, a former Morris andErie Railway executive was convicted of fraud and conspiracy and a five-year prison sentence on November 30,2017.

Fuller, documents show, attempted to steal more than $75,000 by falsely inflating an insurance claim the companyfiled in connection with damage to a railroad switch caused by a truck accident.

The charges stemmed from an investigation of the Morristown-based freight railway by the Division of CriminalJustice Corruption Bureau, which also resulted in a second indictment charging Fuller and a former project managerfor M&E, Willard Phillips, 65, of Langhorne, Pennsylvania, with defrauding the New Jersey Department ofTransportation of more than $800,000 by submitting false claims for grant funds for work on railway improvementsthat was never performed.

Testimony and evidence alleged that Fuller had M&E submit a fraudulently inflated claim and false supporting documents to New JerseyManufacturers insurance company in connection with an accident on March 4, 2005, in which a truck went off the road in a snow stormand became stuck on a railroad switch on tracks owned by M&E in Morristown.

New Jersey Manufacturers was the insurance company for the paper company that owned the truck involved in the accident. The initialinvoice prepared by M&E for the damaged switch was for $29,000, but Fuller ordered that the invoice be falsely inflated prior to

submission to the insurer, according to court documents.

Ultimately, M&E submitted a fraudulent invoice for $144,307 to New Jersey Manufacturers.

At Fuller’s direction, employees of M&E reported to New Jersey Manufacturers that initial repairs on theswitch were ineffective and caused a train derailment resulting in the need for additional repairs. Those reportswere false, prosecutors said. In reality, little damage was caused by the truck and there was no derailment.

The insurance company alerted the Morris County Prosecutor’s Office after learning of the fraud and denyingthe claim. The prosecutor’s office conducted an initial investigation and referred the case to the attorney general’s office.

Guilty in Gulf of Mexico Crash Insurance Fraud

Theodore Robert Wright III pleaded guilty in Tyler, Texas to conspiring to commit wire fraud and conspiring to commit arson. He facesup to 40 years in federal prison.

A Texas pilot who survived a 2012 Gulf of Mexico crash and used an iPad to record his time in the water acknowledges it wasinsurance-related fraud.

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Fitzgerald

Prosecutors said Wright and three others – who’ve also pleaded guilty – bought planes, boats and cars, over-insured them and destroyed the vehicles to collect cash.

Wright in October 2012 appeared on NBC’s “Today” show to describe a crash a month earlier on a flight from Baytown, Texas, to Sarasota, Florida. The plane crashed off Louisiana.

Wright, who’s a native of Port Kent, New York, used his iPad to record the ordeal before rescued.

South Dakota Rancher Pays Government for False Drought Claim

Jason Sparling, of Athol, South Dakota, submitted an application for a disaster payment for a loss of grazing during the summer of 2014,and received nearly $100,000. The rancher has settled with the government over a false claim for federal drought aid.

The federal Agriculture Department later determined that none of Sparling’s cattle were on drought-stricken pasture land.

U.S. Attorney Randolph Seiler says Sparling has paid the federal government $180,000 to settle the debt under the False Claims Act. Seilersays people who knowingly submit false claims are required to pay back more than they received.

Chiropractor Bribed Officers for Accident Reports

Mitchell Davis pleaded guilty December 8, 2017 to conspiracy and making a false statement. His wife pleadedguilty to misdemeanor conspiring to access a computer without authorization.

Davis, a chiropractor and his wife bribed at least four St. Louis, Mo., police officers to get access toinformation on hundreds of accident victims.

The chiropractor’s wife, Galina Davis, used the information to solicit patients for her husband, Mitchell. Hethen pressured some of the victims to exaggerate their symptoms to get larger insurance settlements.

Also Thursday, former officer Terri Owens pleaded guilty to bribery. She admitted she took thousands ofdollars in bribes from 2011 to 2016 to give the information to Galina. Two other officers have been indicted. A

fourth suspected officer has not yet been indicted.

Guilty of Theft

Kevin Robert Fitzgerald, 46 the former general manager of Roddy Ranch Golf Club, Antioch, California, will serve jail time afterpleading guilty on Friday to theft that became the last nail in the coffin for the golf club.

Fitzgerald pleaded guilty to grand theft of personal property with an enhancement, and insurance fraud.

According to court documents, Fitzgerald stole over $326,000 from owner Jack Roddy, Figtree Financing and the Commercial PACE LoanProgram, which finances solar panel installation. Fitzgerald and a co-conspirator pocketed some of the money, paid some of the billsrelated to the golf club and then broke several of the club’s solar panels, lied to police that 300 panels were stolen, then filed a fraudulentinsurance claim. Fitzgerald agreed to the terms of a plea deal in which he will serve three years in county jail, three years of probation andwill give a full disclosure interview with the district attorney’s investigators as to the alleged crimes of his co-conspirator, contractor MarkMattson.

At times, Fitzgerald alleged that he defrauded the business in an effort to save it and also claimed he had a drug problem, but investigatorsdidn’t see any evidence of this.

Roddy Ranch Golf Course was closed in the summer of 2016 and Touchstone Golf, the Texas-based operators of the club, claimed it wasdue to rising water costs. Approximately 25 people lost their jobs.

It wasn’t the first time Jack Roddy, an 80-year-old former rodeo star and rancher, had been taken in by a fraud artist. In 1998, Roddy andpartner Wayne Pierce financed the course and 1,000 luxury homes on the property through Alameda-based broker David Fitzgerald, who isapparently not related to Kevin Fitzgerald. David Fitzgerald sold $35 million in municipal bonds to finance the project.

In 2001, the ranch defaulted on its bond payments. The next year, Fitzgerald paid $300,000 to settle securities fraudcharges after the Securities and Exchange Commission alleged he intentionally misled investors in a plannedcommunity that had no roads or homes.

Four months later, in July of 2002, Roddy Ranch filed for bankruptcy.

Although Kevin Fitzgerald claimed in his sentencing that he was attempting to save the business, Roddy was on thehook for most of the loans.

In 2014, the East Bay Regional Park District purchased the ranch land surrounding Roddy’s home and golf course for$14.2 million. In October, the board closed escrow on the 40-acre home ranch for $1.5 million. On Nov. 21, theboard also authorized purchase of the 230-acre golf course for $1.9 million.

Roddy grew up ranching on a family farm in San Jose and purchased the Roddy Ranch in 1976. Over the years, ranching became less of acash cow and Roddy partnered with investors in the late 1990s to develop the land. Roddy always described himself as a “rancher, not adeveloper,” though, and felt he was thrust into building plans over the years.

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The full text of decisions from courts of appeal and supreme courts across the country are provided so the reader can understand whathappens after the investigation is completed and can apply that information to undertake their own thorough investigations. It allowclaims personnel and their lawyers to understand what errors would cause a defect or a not-guilty verdict.

The effort to reduce insurance fraud requires the assistance of both civil and criminal courts. The Insurance Fraud Deskbook can helpthe prudent fraud investigator, insurance adjuster, insurance attorney, insurance Special Investigation Unit and insurance companymanagement to attain the information needed to deal with state investigators and prosecutor. Available from the American BarAssociation at:

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This book was written to provide sufficient information to those who became interested in the issue since the Georgia SupremeCourt decided State Farm Mutual Automobile Insurance Co. v. Mabry, 274 Ga. 498, 556 S.E.2d 114 (Ga. 11/28/2001) and includescases dealing with the use of diminution in value as a method of determining the amount of loss incurred by a plaintiff seekingindemnity for damage to real or personal property.

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Zalma’s Insurance Fraud Letter

© 2017 by Barry Zalma & ClaimSchool, Inc.

4441 Sepulveda Blvd, CULVER CITY CA 90230-4847

http://www.zalma.com # zalma@zalma.com # http://zalma.com/blog

ZIFL is made available by the publisher for educational purposes only as well as to give you general information and a generalunderstanding of the law, not to provide specific legal advice. By using ZIFL you understand that there is no attorney client relationshipbetween you and the publisher. ZIFL should not be used as a substitute for competent legal advice from a licensed professional attorney inyour state.

Legal Disclaimer

The author and publisher disclaim any liability, loss, or risk incurred as aconsequence, directly or indirectly, of the use and application of any of the contents ofthis blog. The information provided is not a substitute for the advice of a competentinsurance, legal, or other professional. The Information provided at this site should notbe relied on as legal advice. Legal advice cannot be given without full consideration ofall relevant information relating to an individual situation.

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