NU Online News Service, June 29, 3:35 p.m. EDT

Under a House bill signed by Louisiana Gov. Bobby Jindal, the state will be allowed to take earmarked anti-fraud money and transfer it into the state's general fund for non-fraud purposes.

HB 787 calls for about $100,000 of fiscal year 2010 funds–which come from an annual assessment on insurers and are intended for anti-fraud efforts only–to be transferred into the state's general fund.

This money will be used to help balance the state budget for the rest of the fiscal year, according to the bill.

"[HB 787] is a major bill that basically takes money from different accounts and returns it to general fund for other purposes," said Howard Goldbatt, director of government affairs for the Coalition Against Insurance Fraud.

It ultimately reduces the amount of money the state could use for anti-fraud purposes, he added.

Another fraud-related bill, SB 792, extends the state's anti-fraud programs for another two years. The programs are currently set to expire June 30.

The bill also earmarks the state fraud fund solely for insurance fraud purposes and says that any money left over will be returned to insurers, who pay an annual assessment to fund the anti-fraud programs.

This is an attempt to keep insurance fraud money dedicated purely to insurance fraud and to keep the state from sweeping money for other purposes, Mr. Goldbatt said.

SB 792 would transfer $187,000 in current anti-fraud funds to the state theft and fraud prevention authority for a public-awareness campaign.

This money will be used for billboards, advertisements and the like to educate consumers on insurance fraud and help get the message out there, Mr. Goldbatt said.

HB 787 was signed into law by Gov. Jindal on June 25.

SB 792 was passed by the legislature and has been sent to the governor.

Mr. Goldbatt noted that from the governor's perspective, HB 787 was more important to sign because it now gives the state legal authority to take money from funds to help balance the state budget.

The governor's office did not respond to a call.

Special Reports /

New Law Allows La. To Transfer Fraud Money To General Fund

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