Weekly Car Insurance Crime Watch: November 1st

An arrestThe news doesn’t stop, because crime never does either.

With the deluge of crime stories that Online Auto Insurance News (OAIN) sees everyday relating to car coverage, here is a roundup of this week’s biggest headline-grabbing yarns. And it certainly is a deluge: yokels try to swindle insurers; crooks craft elaborate crime rings to stage crash after crash; and officials do their best to beat back the illegal activity that insistently dogs the industry.

This week, our car insurance-related crime roundup has found several incidents that coincidentally land in three no-fault states:

Michigan

Sheriff’s deputy enters guilty plea for staging crash between deer, vehicle

A quarter-century as a sheriff’s deputy might give one the sense of knowing how to circumvent the law.

So if car insurers in Michigan (a state with many a staged accident) keep sharp eyes on shady accidents involving multi-passenger cars, maybe they have less time to focus on accidents involving deer?

If that was the logic for Steven Thomas Keene, it proved unwise.

The Cass County sheriff’s deputy entered a guilty plea for conspiracy to commit insurance fraud last week in a case where prosecutors said he staged a crash between a deer and a vehicle earlier this year and filed a false police report of the “accident.”

The plea spared the now-retired deputy jail time in lieu of a term of probation, according to reports. He had faced a maximum of 10 years in prison for the conspiracy charge.

Florida

Industry Applauds Conviction of Clinic Owner in Crime Ring

Florida lawmakers itching to nix the state’s personal injury protection (PIP) auto coverage system with their next vote will likely be taking note of another development: authorities just scored a major coup in fighting fraud in the PIP system.

Having defended itself against flak about its vulnerability to PIP-related crimes, Florida can count a notch in its belt named David Rodriguez Lopez, a 46-year-old who owned what authorities said was a sham clinic named Indian Rehabilitation Center Inc. in Jacksonville, Fla.

Lopez was convicted for “orchestrating a large-scale PIP fraud scheme,” according to the office of Jeff Atwater, Florida’s chief financial officer.

Atwater called the conviction “a great win” in Florida’s battle against PIP fraud.

“It takes a well-coordinated effort from the fraud prevention community to bring a fraud ring leader to justice,” he said in a statement.

Authorities said they can link more than two dozen staged collisions since March 2012 to Indian Rehab, where more than 60 people had claimed to be treated for injuries from those crashes.

But some of those treatments never took place, Atwater’s office said, because some involved “equipment the facility did not possess.”

The clinic billed more than $240,000 in total, according to Atwater. The investigation is ongoing with more arrests expected.

The Property Casualty Insurers Association of America (PCI), a trade organization, said it commended the conviction as a “step in the right direction.”

“[The conviction provides] relief to Florida consumers who continue to be plagued by a $1 billion auto insurance fraud tax,” Donovan Brown, state government relations counsel for PCI, said in a statement.

City council candidate arrested for alleged fake carjacking

Orlando Robles-Santana, a Jacksonville man who was a candidate for City Council, was arrested last week for allegedly filing an insurance claim to replace a vehicle he told authorities was carjacked.

“We will not stand by and let individuals like this steal the hard-earned money of honest Floridians,” Florida CFO Atwater said in a statement.

Robles-Santana faces charges that could mean a five-year sentence. He has since withdrawn from the race, citing his “moral commitment,” his “identity as a human being,” and his “values.”

A well-worded—but maybe a bit insincere—exit.

Two men in a pickup truck carjacked his 2004 Jaguar sedan, according to Robles-Santana, who had asked for “reimbursement of the full value of the vehicle.”

It was nearly a year later that the Jaguar was rediscovered at a local salvage yard, where the owner said “he knew Robles-Santana personally and he had asked him to watch after the vehicle while he was out of the country,” according to the office of Florida CEO Atwater.

In other Jaguar news, they are still winless.

Minnesota

Federal lawsuit targets nearly four dozen chiropractic clinics

A lawsuit recently filed in federal court in Minneapolis highlighted statewide fraud there, where prosecutors say a six-year kickback and racketeering scheme involved 46 chiropractic clinics throughout Minnesota.

The scheme brought a mobile MRI facility to each clinic, which would provide patients to the facility in exchange for kickbacks, the lawsuit said.

A state insurance official said Minnesota is grappling with such schemes because it is a “no-fault state,” according to WCCO Minneapolis, a CBS affiliate.

Being a no-fault state has attracted organized criminal elements who “own chiropractic clinics,” “stage accidents,” and participate in other nefarious activities relating to car insurance fraud.

St. Paul man creates fake clinic to defraud no-fault law

Another scam perpetrated under Minnesota’s no-fault law was reported earlier this month, when a St. Paul, Minn. man was charged for an “elaborate scheme” against GEICO involving a 2011 crash.

Maurice Culpepper said he received nearly 200 treatments that rang up more than $44,000 in bills that deserved reimbursement, according to the Star Tribune.

Culpepper had created a fake clinic to back up his fake medical bills, authorities said.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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