The New York Insurance Department reported today that there were 708 arrests in insurance fraud cases last year, up from 604 in 2006 for a 17 percent increase.
Insurance fraud schemes investigated by the department's Frauds Bureau along with local authorities also led to court-ordered restitution of $20 million stemming from convictions against 147 people in 2007, the agency said.
The report noted that this year the bureau established a Major Case Unit to focus on the investigation of systemic insurance fraud involving organized conspiracies with unit investigators handling complex cases involving no-fault, commercial rate evasion, health care fraud and workers' compensation premium fraud.
Steven Nachman, deputy superintendent for fraud and consumer services, said, "The Insurance Department intends to continue its aggressive efforts to crack down on insurance and health care-related fraud. These activities are illegal and hurt all honest New Yorkers by needlessly driving up the cost of health, auto, property and many other forms of insurance."
The report also noted the arrest of 149 persons for workers' compensation fraud, including 89 people arrested for fraudulently taking benefits while secretly working second jobs. New cases opened for investigation by the bureau totaled 1,072.
Most insurance fraud cases are now tracked electronically by means of a Web-based case management system that became fully operational in 2007, the bureau reported.
The system, it was explained, allows insurers to electronically transmit suspected fraud reports to the bureau and allows bureau personnel to track investigative tasks and events from initial assignment through closure.
In 2007 the bureau received 22,079 reports of suspected fraud. Of that total, 21,337 were received from licensees required to submit such reports to the department and 742 were received from other sources, such as consumers and anonymous tips.
Among major cases listed in the report was a seven-month joint investigation by the Frauds Bureau, the Queens District Attorney's Office, the State Insurance Fund and the Workers' Compensation Board Inspector General's Office that resulted in the arrest of 10 suspects in a workers' comp fraud totaling more than $110,000.
Most of the defendants were accused of collecting workers' compensation benefits while they were employed.
The complete report may be accessed on the Department's Web site, www.ins.state.ny.us. It is listed under Helpful Resources.
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