NYSID Annual Fraud Report Shows Progress

January 17, 2003

New York State Superintendent of Insurance Gregory V. Serio has submitted the NYSID’s Annual Report on the operations of the Insurance Frauds Prevention Act and the activities of the Insurance Frauds Bureau for Calendar Year 2002 to the Governor and the Legislature.

The 39 page report [available in full at the NYSID Web Site: http://www.ins.state.ny/nyins.htm] contains encouraging news. Serio called 2002 “an exceptional year,” and noted in his introductory letter that “The number of arrests reached an all-time high and criminal convictions set a new record, topping last year’s total by more than 85%.”

He stressed the importance of “nurturing and strengthening” the NYSID’s Frauds Bureaus relationship “with law enforcement, prosecutors and insurance company Special Investigations Units across the State,” noting that “Multi-agency cooperation was evident in the success of many investigations during 2002.”

Serio singled out an investigation conducted jointly by the Frauds Bureau, the Suffolk County District Attorney’s Office and the National Insurance Crime Bureau, which led “not only to arrests but to the seizure of cash, bank accounts and more than $1 million in
commercial real estate.” He noted that this was the first time that the “Insurance Department successfully used New York’s forfeiture statutes to impose economic as well as criminal sanctions in an insurance fraud case,” and added that “currently, every case is being evaluated for the possibility of seeking economic penalties.”

Serio struck a somber note in referring to the anniversary of the Sept. 11 attacks, stating that “the Department reflected on the events of a year earlier with sadness for all we lost on that day.” He expressed pride, however, in how his department had met the “challenges presented to the entire insurance community by those events.”

“The Frauds Bureau has been ‘fast-tracking’ World Trade Center claims to ensure that they receive prompt attention,” said the letter. But Serio warned that he had made certain that “strong lines of communication existed among all agencies involved in this issue, the Frauds Bureau successfully coordinated its investigative efforts with other law enforcement agencies,” and said it would “continue to pursue those who seek to take advantage of the World Trade Center tragedy, or any other situation, to commit insurance fraud.”

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