N.J. Woman Sentenced as Part of $600,000 Fraud Theft

October 16, 2003

New Jersey Attorney General Peter Harvey announced that a Middlesex County woman was sentenced for her reported role in a large scale, multiple defendant conspiracy to defraud two insurance companies out of more than $600,000.

According to Vaughn McKoy, Director, Division of Criminal Justice, and Insurance Fraud Prosecutor Greta Gooden-Brown, Carol Cappuccio, 39, of Edison, was sentenced to five years probation conditioned upon serving 90 days in County jail. In addition, Cappuccio was ordered to pay restitution to Allmerica Insurance Company and the St. Paul Insurance Company in the amount of $16,000 and also ordered to pay a $8,000 civil insurance fraud fine, pursuant to the Insurance Fraud Prevention Act.

Cappuccio was sentenced pursuant to her guilty plea to a State Grand Jury indictment returned on Dec. 18, 2002, which charged her with conspiracy and theft by deception (3rd degree).

At her guilty plea hearing on Aug. 1, 2003 before Middlesex County Superior Court Judge Frederick DeVesa, Cappuccio reportedly admitted that from Sept. 24, 1998 to May 4, 1999, Carl Prata, a former employee with the Allmerica Insurance Company and the St. Paul Insurance Company, concocted a scheme to access and manipulate the insurance company’s computer systems by inserting information that Cappuccio, and 41 other individuals had been involved in non-existent automobile accidents over a three-year period from Jan. 1, 1998 to Nov. 28, 2000.

Additionally, Cappuccio reportedly recruited other persons to become part of the conspiracy and to have their names and “accident” information fraudulently added to the claims computers in order to receive insurance claim checks. Cappuccio reportedly admitted that she recruited three persons to receive fraudulent insurance claim checks as part of the scheme. The three individuals received at least three fraudulently issued insurance claim checks in the amount of $23,500. Cappuccio received a fraudulently issued insurance claim check in the amount of $16,000.

Prata was charged on Dec. 18, 2002 and in a separate State Grand Jury indictment Prata pled guilty to the indictment on April 28, 2003 and on Aug. 25, 2003 was sentenced to five years in state prison and ordered to pay $50,000 in restitution to the Allmerica Insurance Company ($45,000) and the St. Paul Insurance Company ($5,000). Prata was a former employee with the Allmerica Insurance Company and the St. Paul Insurance Company.

The Division of Criminal Justice – Office of the Insurance Fraud Prosecutor’s investigation determined that the manipulation of non-existent accident information resulted in the insurance company’s computer systems processing and issuing more than 50 fraudulent insurance claim checks to approximately 42 persons resulting in an attempted theft in excess of $600,000.

All 43 persons, including Cappuccio and Prata, have reportedly pled guilty and have been sentenced to either State prison, County jail, probation or admitted into the Pre-trial Intervention Program. Eight of the 43 persons were sentenced to jail terms.

“This scheme was a significant automobile insurance fraud conspiracy involving 43 individuals claiming more than $600,000 in nonexistent claims,” said Gooden Brown. “The two insurance companies, their policy holders and all New Jerseyans are the victims of these type of illegitimate insurance fraud schemes.”

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