Couple Involved in Fraud Scam Sentenced

Basheba and Cedric Peoples, both 35, of Las Vegas were sentenced for their alleged involvement in an internal insurance fraud scheme victimizing California State Automobile Association (CSAA).

The suspects were sentenced to nine months in the County Jail and the term of incarceration suspended, provided: both pay restitution to CSAA totaling the amounts of $3,350; each must also reimburse the AG's Insurance Fraud Unit (IFU) $1,000 in investigative costs; and each must also complete Impulse Control Counseling.

While conducting a routine internal audit for CSAA, an investigative firm, Blande & Rodart, discovered the fraud. Further investigation by the Insurance Fraud Unit revealed that Guy Mitchell Sheets, a licensed insurance agent and regional supervisor with CSAA, along with Deborah Marie Bray, a claims adjuster under Sheets' supervision, reportedly created approximately 20 false insurance claims, defrauding CSAA of over $180,000 during an 18 month period.

The conspiracy allegedly involved Sheets and Bray recruiting 14 other individuals and "packing" them into the accident claims in which they had no actual involvement. Sheets and Bray have been sentenced on their felony charges, as have most of the other participants.

Fraud Bust Leads to Five Arrests

An undercover operation bust led to five arrests in San Bernardino County, Calif. The California Department of Insurance's (CDI) Urban Auto Task Force arrested Dr. Michael Loader, 49, a chiropractor, of Claremont; Bruce Sutton, 45, of Ontario; Ramona Toney, 48, of Riverside; Denise Martin, 35, of Torrance; and Bernita Ingram, 38, of Fontana. All are charged with felony insurance fraud, as the result of an investigation dubbed "Operation Pay Out."

Loader, while working at De Anza Health Clinic in Ontario, Calif., allegedly provided medical examinations, medical reports and medical billings for the purpose of bodily injury claims submitted to various insurance carriers. Investigators went undercover and were allowed to sign in for treatments that were never executed. The medical billings were increased by Loader to maximize profit. Loader was reportedly informed that they were staged traffic collisions. Loader allegedly agreed to prepare medical reports and billings for individuals he never saw, as well. More arrests are anticipated.
Mother Arrested for Insurance Fraud

Teodolinda Loya, 43, of San Jose, Calif., was arrested for one felony count of conspiracy to commit insurance fraud, one misdemeanor count of delaying and obstructing a police officer, and one misdemeanor count of making false statements to police officers. Her son, Rene Gutierrez Aguirre, 23, also of San Jose, Calif., was also issued a warrant for arrest but is still outstanding. Aguirre's warrant is for one felony count of insurance fraud and one felony count of conspiracy to commit insurance fraud.

In Feb. 2002, Aguirre was reportedly driving his mother's 1997 Ford Expedition in Santa Clara when he lost control of the vehicle and hit a light pole. Loya went to the insurance company the same day and allegedly claimed that she was driving the vehicle at the time of the accident. Investigators allege Aguirre was driving the vehicle at the time of the accident. There was approximately $8,446 in potential loss if the claim had been paid.

Bail is set at $20,000 for Loya, and $10,000 for Aguirre.

Insurance Fraud Arrest

Brian Pelech, 33, of Ontario, Calif., was arrested and charged with two felony counts of insurance fraud.

In Aug. 1999, Pelech allegedly slipped between scaffolds resulting in injury to his right knee requiring surgery, while working as a bricklayer. A medical evaluation on Pelech determined his condition was permanent and stationary. In March 2001, Pelech reportedly submitted a claim for worker's comp benefits. In April 2001, Pelech was videotaped performing masonry work that required bending, standing, cutting bricks and lifting on more than one occasion. On June 14, 2001, Pelech stated during his disposition he had not climbed a ladder since his injury, he could no longer perform bricklaying and he had not done anything for money since his injury. Witness interviews revealed Pelech was paid $700 for performing masonry work in April.

Bail is set at $25,000. If convicted, Pelech faces up to five years in prison and a $50,000 fine.

Workers' Compensation Fraud Arrest

Charlotte Chapman, 54, of Napa, Calif., was sentenced to three years in prison, ordered to pay $94,000 in restitution and fined $740 for workers' compensation insurance fraud.

Chapman received workers' comp medical and disability benefits as well as private disability benefits for complaints of neck and back pain and carpal tunnel syndrome, from 1999 to 2001. During this time, Chapman was allegedly working at Valley Medical Managers and at Kings Industrial Occupational Medical Center, a clinic that specializes in providing care for injured workers covered by workers' compensation insurance. A "paper" corporation that was used to pay her personal expenses reportedly concealed her income from this employment.

CDI Fraud Arrest

Gyan Singh, 55, of Sacramento, Calif., was arrested on one count of insurance fraud. Singh was allegedly involved in an auto accident with his 1997 Ford truck on Dec. 7, 2001. Investigators claimed that Singh reported to insurance carrier CSE that he was injured and was unable to perform his duties as a maintenance worker. Singh submitted approximately $5,000 in wage loss statements to his attorney who, in turn, submitted them to CSE for reimbursement. An investigation by CDI Fraud revealed Singh forged the signature of his supervisor and falsified the amounts claimed on the wage loss statements.

Bail is set at $5,000. If convicted, Singh could face up to five years in state prison and/or a maximum fine of $50,000.