Insurance fraud is a colossal problem throughout the U.S., costing taxpayers over $90 billion a year, diverting crucial resources, and creating dangerous conditions for citizens. Given the huge costs of insurance fraud, prosecutors take this crime very seriously and aggressively pursue those suspected of committing insurance fraud.
Consider these facts: Hurricane Katrina, considered one of the worst national disasters to ever occur on U.S. soil, resulted in approximately $41 billion in losses. While an astounding sum, this figure pales in comparison to the $90 billion a year lost to insurance fraud. Insurance fraud is considered the second largest economic crime in America, second only to tax evasion.
In recent years, Massachusetts, like many states, has cracked down on insurance fraud. The catalyst for the state’s crackdown on auto insurance fraud stems from the death of a great-grandmother in a staged automobile accident. In 2003, 65 year old Altagracia Arias was the passenger is a vehicle that was involved in a staged accident, intended to defraud the insurance company. Arias died in the incident. In response to the incident, numerous cities in Massachusetts instituted Community Insurance Fraud Initiatives. These taskforces have resulted in mass arrests for those suspected of committing auto insurance fraud.
Auto insurance fraud is not the only insurance fraud taken seriously in the state of Massachusetts. Recently, the Massachusetts’ Secretary of Health and Human Services, John Polanowicz, announced the launch of a $5 million program designed to curb Medicaid fraud. Under the program, Medicaid will freeze payments to health care providers suspected of fraudulent activity. Extensive investigation will then occur, and insurance fraud violators will be punished to the full extent of the law.Types of Insurance Fraud
Insurance fraud occurs when an individual commits a dishonest act with the intent to obtain a benefit or advantage to which they are not otherwise entitled. Insurance fraud can classified as either soft or hard fraud.
Soft fraud, or opportunistic fraud, occurs when a policyholder exaggerates their otherwise legitimate claim. For example, an individual is involved in an automobile accident and has a valid claim for damages, but they claim far more damages than they actually incurred. Or, in obtaining a new insurance policy, an individual misrepresents existing conditions to obtain a lower rate.
Hard fraud occurs when an individual deliberately plans or devises to crease a loss, such as a fire, automobile accident, or theft that is covered by their insurance policy in order to obtain payment for damages.
Insurance fraud encompasses many different crimes. Below is a list of the most common types of insurance fraud:Homeowner’s Insurance Fraud
Homeowner’s insurance fraud encompasses the burning of insured property. The crime of burning insured property with the intent to defraud is a felony in Massachusetts, set out in Massachusetts General Laws Chapter 266 Section 10. To convict an individual of this crime, the prosecution must prove beyond a reasonable doubt that the defendant set fire or attempted to set fire to a property which was insured, with the specific intent to fraud the insurer. The burning of insured property is a crime taken very seriously by prosecutors as it results in grave losses not only to the insurance company but also to homeowners in the form of premium increases, and carries with it substantial risk of injury or death to citizens. You can be imprisoned for up to 5 years for commission of this offense.
Homeowner’s insurance fraud can also consist of submitting falsely exaggerated claims follow a disaster or falsely attributing damages to a disaster in order to obtain payment.Automobile Insurance Fraud
Automobile insurance fraud can occur when an individual stages an accident in an attempt to collect damages, as in the case leading to the tragic death of 65 year old Altagracia Arias. It can also occur from the filing of false claims of auto theft, or filing a claim which exaggerates your legitimate damages due to an automobile accident. Automobile insurance fraud, codified in Massachusetts General Laws Chapter 266 Section 111B, is punishable by up to 5 years imprisonment and fines of up to $10,000.Health Insurance Fraud
Health insurance fraud costs taxpayers over $60 billion a year, and Medicaid fraud costs the state of Massachusetts over $10 million a year. Health insurance fraud occurs when false health care claims are filed in order to obtain a financial benefit. This can include billing for care you never received, filing inaccurate claims paperwork, prescribing unnecessary treatment, reselling medication, or falsely changing medical records. It can also include allowing others to use your health insurance or misrepresenting prior existing conditions when applying for health insurance.
Health care fraud violators can be charged federally under 18 U.S.C. Chapter 63, Section 1347. This statute makes it a crime to knowingly and willfully execute or attempt to execute a scheme to defraud any heath care benefit program; or, to obtain by false or fraudulent representations, any money or property owned by any health care benefit program. Those found guilty of health insurance fraud can be punished by up to 10 years imprisonment, along with hefty fines.The Law Offices of Stephen Neyman Can Help
If you have been charged with committing insurance fraud, whether it be homeowner’s insurance, automobile, health, or any other form of insurance fraud, The Law Offices of Stephen Neyman can help. Insurance fraud is a serious crime in the state of Massachusetts, one that can lead to years of imprisonment, crippling fines, and a grim criminal record. Insurance fraud investigators are experienced, ruthless, and highly trained. You need a skilled, savvy criminal defense attorney in your court to defend against charges of insurance fraud and you need to act quickly. Securing the representation of a skilled defense attorney as soon as you suspect you may be charged with insurance fraud is crucial, as insurance fraud charges can progress rapidly. The sooner you secure competent counsel, the sooner you can began mounting your defense. Stephen Neyman has over 20 years experience in the insurance fraud defense arena. Our team of professional attorneys will tirelessly fight for you to obtain the best possible legal outcome. Call us today at (617) 263-6800 for a free phone consultation.
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