California Insurance Fraud Cases Still Mounting
Big Brother "District Attorney" is watching you
State and federal agencies, along with the implementation of more effective communication devices has resulted in the “enforcement of insurance fraud in multiple folds” states Los Angeles District Attorney Loren Naiman, assigned to the Special Insurance Fraud Task Force. “We now meet at least once a month to discuss leads in addition to jointly targeting individuals. I’m currently working with a task force involving the Federal Bureau of Investigation, Internal Revenue Service, Postal Department, Department of Insurance, Los Angeles Police Department, and the State bar of California. There will be more MAJOR arrests before years’ end.”
“Los Angeles County is the fraud capitol of the world” states Los Angeles District Attorney Lenny Schaeffer, “although the fraud is tending to move out of Los Angeles County into surrounding areas. We’re still working on cases and they’re still coming in.”
How does a suspected insurance fraud case come to the attention of state and federal authorities? “First”, says Loren Naiman, “all insurers have Special Investigative Units (SIU’s) to investigate fraudulent claim practices. These SIU’s send in documents on suspicious activities, developing leads in other cases. Second, we get cold calls from the public and recently, have received a number of calls from attorneys who just realized their offices had been taken over by people signing their names. Third, a disgruntled client or just a plain snitch” says Lenny Schaeffer.
Whether an insurance fraud case is prosecuted federally or locally is by agreement, whichever route maximizes punishments. Once an attorney is “caught up” in the alleged fraudulent loop, full disclosure and cooperation with the authorities may affect criminal liability and the threat of disbarment.
Assume an attorney is involved in insurance fraud, he does not know if he is a “target”, but players around him are dropping like flies and he wants to minimize his exposure. Lenny Schaeffer advises that, “generally we tell them about a standard letter that we offer, taking a statement under oath agreeing that it can’t be used against them except for impeachment and for the purpose of perjury. However, the attorney must agree that any evidence developed independently can be used against them. Looking at all the evidence, we see if some type of plea agreement can be worked out perhaps avoiding disbarment”.
NEVER attempt to contact the District Attorney’s office or any investigative agency directly. It is critical to use an experienced legal counsel who is also familiar with all of the players.
Capping is illegal in California – having someone who goes out to sign people up is not. “Keep an eye on who’s coming into your office. Review your files, look for patterns, similarities, inconsistencies” cautions both Naiman and Schaeffer.
