Fraud of the Week: Reasons to be Blue in Hawaii

A Hanamalu, Kauai married couple will be trading in warm rays and Hawaiian sunsets for the depressing glare of fluorescent jail-cell lighting after perpetrating insurance fraud. As it turns out, crime really doesn't pay, especially in Hawaii.

According to the Hawaii Insurance Division, Clifford Cabinatan and Kelly Teves-Cabinatan will serve time and face other serious consequences for committing fraud and theft of more than $6,000 from GEICO Casualty. In May 2006, Clifford Cabinatan intentionally damaged his vehicle during a domestic dispute. Witnesses as well as police reports confirmed the incident. However, the deceitful duo dialed the Kauai Police Department and GEICO Casualty, claiming that their vehicle had been vandalized.

Clifford Cabinatan pled guilty to one count of theft in the second degree and one count of insurance fraud -- both felonies -- and to false reporting to law enforcement authorities. In February 2009, a judge sentenced Clifford Cabinatan to one year in jail, five years of probation, and 500 hours of community service. Additionally, the court ordered him to pay restitution to GEICO Casualty and court fines and fees. Kelly Teves-Cabinatan also pled guilty to the same charges. She received a more lenient jail sentence -- the court ordered her to spend 60 days in jail -- but the consequences of her actions played out similarly to that of her husband. The court also sentenced her to five years of probation, 500 hours of community service, and to pay restitution to GEICO Casualty and court fines and fees.

"Insurance fraud is a crime," said Hawaii Insurance Commissioner J.P. Schmidt. "[It] affects everyone by inflating the cost of insurance."

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