N.Y. Files Auto Fraud Charges Against 25 People

September 26, 2002

New York Attorney General Eliot Spitzer and Insurance Superintendent Gergory Serio announced charges have been filed against 25 people allegedly involved in two auto insurance fraud rings operating in New York City.

Charges against the individuals include grand larceny, conspiracy, insurance fraud, and falsifying business records.

Defendants involved in one ring allegedly caused auto accidents and then sought medical treatment for feigned injuries. Defendants in the other ring allegedly created fake accident reports and then sought medical treatment for feigned injuries. Both rings submitted more than $425,000 in fraudulent bills to insurers, which paid more than $200,000.

The first fraud ring is believed to have operated in 2001 in Brooklyn. A Brooklyn grand jury indicted 13 defendants for submitting 24 fraudulent claims worth $300,000 to four insurance companies under New York’s no-fault law. Carriers paid more than $100,000 of those claims.

The second ring operated in both Brooklyn and Manhattan; 12 people were arrested in connection with it. They allegedly claimed to have been involved in five phony car accidents, and their subsequent clinic visits resulted in more than $125,000 in claims to insurers, which then paid out $100,000.

Assistant Attorneys General John Balestriere and Brenda Hall of the Auto Insurance Fraud Unit are prosecuting the cases.

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