A Buffalo, N.Y., man is accused of using a whole lot of nothing to commit insurance fraud against Allstate.
According to a release from the New York State Insurance Department, Sidney Edwards, 55, used a bank account that didn't exist to buy insurance on a home that he didn't own, all so he could cash in on property losses that didn't occur.
Apparently, the scheme attempted to exploit holes in the company's claim reporting system. According to documents, Edwards randomly selected a home and used the address to buy a homeowner's policy on the property. He then provided Allstate with a fictitious bank account number for payment of the premium.
At a later date, Edwards is alleged to have filed a claim for damages to a garage door. Allstate honored the claim, and mailed him a check for $1,600. When Edwards complained that he never received the check, the insurance company proceeded to mail him a second check for $1,600.
An investigation by the New York State Insurance Department's Frauds Bureau revealed, however, that the real property owner didn't know Edwards and was unaware of the policy that Edwards bought. Furthermore, investigators determined that no damage ever occurred to the garage door on the property.
However, that didn't stop Edwards from cashing both claim checks at local stores. For these allegations, Edwards was charged with two counts of fourth degree grand larceny. He could be sentenced to up to three years in prison if he is convicted.
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