Fraud of the Week

November 14, 2016

False Claim—New Jersey

Amount: $35,000

 

A local rabbi is being sued by New Jersey officials who claim the rabbi violated New Jersey's anti-fraud act by collecting insurance money from twenty-three false reports that his luggage was stolen form an airport terminal. The rabbi flew to Miami International Airport over twenty times from 2010 to 2012, each time filing false reports that his luggage had not arrived to the baggage claim area. The rabbi collected $500 per claim of lost or delayed luggage from his insurance provider, then purchased replacement items and submitted the receipts to the insurance company and subsequently returned all of the items for a full refund. Over time the rabbi was paid over $35,000 for fraudulent claims from his insurance company. The civil penalty for such a crime is $5,000 for the first offense, $10,000 for the second offense, and $15,000 for each subsequent offense, as well as a $1,000 surcharge and restitution to the insurance companies, among other expenses. This habit of committing insurance fraud could cost the rabbi up to $366,000.