The Florida Department of Financial Services’ Division of Insurance Fraud (DIF) announced the arrest of two unlicensed clinic owners from Miami-Dade County. Noel Ruiz of Miami and Alberto B Franco of Hialeah were accused of being involved in a “straw owner” scheme that defrauded numerous insurance companies, resulting in more than $650,000 in financial losses.
An investigation led by DIF revealed that in the time between December 2012 and September 2014, Franco and Ruiz both failed to carry the proper licensing required to own a rehab clinic and allegedly used a “straw owner” to bypass Florida’s licensing requirements.
A “straw owner” is a person who owns a business or property on someone else’s behalf. By portraying legal ownership of the property or business through legal documentation, the actual owner of the business is essentially left off of the books. In some cases, this scenario would occur as a legal way to keep the identity of the actual owner of the entity hidden. In other cases, a “straw owner” would act as a pawn to establish a business in order for unlicensed agents to conduct nefarious or illegal transactions under a legitimate license.
DIF’s investigation revealed that Ruiz was the actual owner of Rehab and Wellness Inc., a physical therapy clinic in Miami. Franco was the actual owner of Magic Hands Rehabilitation Center Inc., another physical therapy clinic in Miami. Unbeknownst to their straw owners, Ruiz submitted dozens of claim files to insurance companies for fictitious rehabilitative services totaling over $361,880 and Torres also submitted dozens of claim files to insurance companies for illegitimate rehabilitative services totaling $297,677.
Both Ruiz and Franco were arrested on January 14, 2016, and booked into Turner Guilford Knight Correctional Center on charges of operating an unlicensed clinic, insurance fraud, grand theft, and an organized scheme to defraud.
These cases are being prosecuted by the office of Miami-Dade County State Attorney Katherine Fernandez Rundle and if convicted, Franco and Ruiz face up to 30 years in prison.
Source: Florida Department of Financial Services