NEW YORK– Fraud is expected to pick up in New York State as the economy worsens and as perpetrators adapt to fraud fighting efforts, state agency investigators said at the annual meeting of the New York Alliance Against Insurance Fraud.
Steve Nachman, deputy superintendent for Fraud and Consumer Services, New York State Insurance Department, said phony automobile theft claims through "owner give ups" have spiked by about 25-30 percent this year, likely due to the economy.
Demonstrating the diverse demographic of those now resorting to such conduct, Mr. Nachman said recently arrested perpetrators have included a New York City police officer, a building inspector, a Department of Homeland Security employee, and a school security guard.
Speaking to no-fault fraud, Mr. Nachman said activity is starting to rise after gains made by the state in 2005-06. He said no-fault fraud is "here to stay," as prosecutors try to find creative ways to stop fraud while fraudsters try to figure out creative ways to avoid getting caught.
For example, Ellen Burach-Zion, chief of the Auto Insurance Fraud Unit within the Office of the Attorney General, said the actual staging of accidents has declined, but fraud rings are now recruiting real accident victims by buying patient lists from hospital employees. Some of these lists, Ms. Burach-Zion said, can be sold for up to $3,000.
On the law enforcement side, Mr. Nachman pointed to a creative prosecutorial effort by the Queens District Attorney's Office, which went after a ring that targeted Asian-American drivers using hate crime charges because the operation was singling out people based on their ethnicity.
Regarding workers' compensation fraud, William Gurin, inspector general, New York State Workers' Compensation Board (WCB), said there has been more success recently as the WCB has shifted focus from claimant fraud to health care and employer fraud. The WCB did not have much success getting prosecutors to take claimant fraud cases, he said, adding that there is a better return for the money going after health care fraud and employers.
With health care fraud, Mr. Gurin said the WCB is investigating services billed for but not provided, such as surgeries; double billing, where medical providers will bill Medicaid or private carriers in addition to the workers' comp carrier; and "unbundling," which occurs when medical providers bill procedures separately instead of one lump sum.
All state agency representatives stressed the importance of cooperation, both with each other and with insurance carriers. Mr. Gurin, for example, said the WCB will focus on health care providers that are identified by other agencies as a source with a history of fraudulent billings. Regarding carriers, he said the WCB relies on insurers' special investigative unit investigations for information that can be presented to prosecutors.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.