Calif. Chiropractor, Legal Arrested

An Encino chiropractor and her legal assistant have been arrested and charged with two counts each of insurance fraud following an investigation by the California Department of Insurance Fraud Division.

Chiropractor Nasrin "Nancy" Hadizadeh Fathi, and legal assistant Behrouz Beck Saffary, were taken into custody on charges that they overbilled insurance companies for treatment of patients. The two, both of Encino, were booked at the Los Angeles County Jail and bail was set at $40,000 each. The Los Angeles County District Attorney's Office is prosecuting the case.

At the time of Fathi's and Saffary's arrest, authorities executed search warrants at Valley Spine Institute (the clinic operated by Fathi) and the Law Offices of Karineh Avanessian (the law office utilized by Saffary).

According to investigators, in February, 2004, CDI received a complaint that Fathi was over-billing insurance companies for chiropractic treatment that she never performed. Based on the complaint, Fraud Division Investigators initiated an undercover investigation into Valley Spine Institute.

Posing as traffic collision victims, the investigators went to the clinic to seek treatment. Saffary, upon the initial visits, allegedly would have the investigators sign forms so they would be represented by the Law Offices of Karineh Avanessian.

The undercover operatives were treated by Fathi on no more than three occasions each. Upon their last visit to the clinic, Fathi and Saffary allegedly had the undercover investigators sign numerous sign-in sheets to give the appearance that the chiropractic treatment lasted much longer, and was more extensive, than it actually was.

Fathi allegedly sent chiropractic bills to insurers, and settlement demands from the law office were later received by the involved insurance companies.

During the case, investigators found that inflated bills or settlement demands were sent to at last two companies. 21st Century Insurance Co. received medical bills and a demand for settlement in the amount of $18,770. This covered two investigators' 'injuries" and chiropractic treatment. Liberty Mutual Insurance Co. received medical bills and a demand for settlement in the amount of $13,310 for one investigator's "injuries" and chiropractic treatment.

The National Insurance Crime Bureau, Farmers Insurance Co., 21st Century Insurance Co. and Liberty Mutual Insurance Co. assisted in the investigation of this case.

Contractor Pleads Guilty to Comp Fraud

California Insurance Commissioner John Garamendi announced that a Landers roofing contractor has pled guilty to workers' comp premium fraud and other charges. Michael Louis Curran pled guilty on June 8 to one felony count of making material misrepresentations to the State Compensation Insurance Fund in order to obtain workers' comp insurance for his workers at less than the proper rate and one felony count of intent to evade taxes to the Employment Development Department.

The investigation revealed that Curran, doing business as Curran Roofing, while working on a roofing project in Indio, made material misrepresentations to SCIF to obtain the lower premiums by intentionally misclassifying his workers' job classifications and intentionally failing to disclose his total payroll. This resulted in lost workers' comp premiums of approximately $60,000 to SCIF. Working in conjunction with the EDD, the investigation revealed that Curran also failed to report and pay employment taxes to EDD in the amount of $6,000.

As a result of the guilty plea, Curran was placed on formal probation for 36 months, ordered to pay $60,000 in restitution to SCIF, $6,000 in restitution to EDD, and spend 240 days in county jail. He was also ordered to violate no workers' comp, labor or employment tax laws. The investigation was conducted by the CDI Fraud Division.

Modesto Agent Arrested

A Modesto insurance agent/broker has been arrested and charged with 36 felony counts of insurance fraud stemming from a five-month joint criminal investigation conducted by the CDI and the Stanislaus County District Attorney's Office.

The investigation focused on alleged fraudulent issuance of insurance certificates and failure to remit premium payments to insurers.

Luis Urena, of Modesto, operated his insurance business, Urena Insurance Agency, from an office in Salida. He is suspected of collecting premiums from consumers seeking coverage for homes, automobiles, and for commercial automobiles. Investigators believe that the bogus policies he sold brought in more than $75,000 in premium payments.

Urena also allegedly issued fraudulent insurance certificates and insurance identification cards to his clients, leading them to believe they had legitimate insurance coverage, when in fact they had no insurance to cover claims. Urena's alleged insurance scam has resulted in numerous unpaid claims. The investigation revealed more than 100 victims with an estimated loss of more than $100,000.