South Florida insurance fraud artists are becoming so rampant in the area that authorities have launched a campaign to catch area con artists who stage car wrecks and bilk insurance companies of hundreds of thousands of dollars in false insurance claims.
According to authorities in Dade County, Fla., last year there were 193 arrests for staged automobile accidents, but a new law targets such criminals. This month 10 so-called accident victims, a man who recruited them and the owner of a Miami-Dade County medical clinic were in court for their first appearances after state officials arrested them for their roles in an alleged scheme that defrauded private insurance companies of more than $460,000.
In the past, anyone convicted of staging wrecks was usually sentenced with fines and probation. Now the law mandates a minimum two-year prison sentence.
“The law adds more teeth to this ongoing problem. It’s been a problem for so long, we had to find a way to go even more aggressively against it,” Nina Banister, a spokeswoman for the Florida Department of Financial Services told the Fort Lauderdale Sun-Sentinel.
In September Omar Lantingua-Gonzalez, became the first person in Florida to be convicted under the new law and was sentenced to two years in prison, records show.
According to official estimates there are more than 300 fraud rings on South Florida’s heavily congested roadways, driving up the cost of automobile insurance for Florida motorists. Commonly referred to as Personal Injury Protection fraud, the scam relies on the $10,000 in insurance each Florida motorist is required to carry.
The scheme includes “recruiters” and “planners” who pay people up to $1,500 to participate in accidents. After a wreck, the recruiter sends the victims to a clinic where administrators fleece the insurance companies for up to the $10,000 limit — for treatments the patients never receive.
Capt. Steve Smith, head of the Miami-Dade office of the Florida Division of Insurance Fraud, estimates there are about 3,000 such clinics in Florida, about half of them in Miami-Dade, Broward and Palm Beach counties.
To combat the swindlers, Smith relies on six investigators devoted exclusively to insurance fraud cases. Yet, despite the increased ammunition in investigators and stiffer laws, Smith said progress continues to be slow.
“It really has gotten to a point where it is overwhelming at times. As soon as we bust one group, there’s another one out there starting up,” he told the Sun-Sentinel. “Sadly, we’ve barely scratched the surface. At least little by little we’re moving towards the right direction.”
Added measures include a special prosecutor at the Miami-Dade State Attorney’s Office. Less than one year on the job, the prosecutor already has more than 160 cases, said Eugenia Tyus, general manager of the Automobile Joint Underwriting Association.
The association, created by Florida to insure drivers who can’t get insurance through normal means, helps pay the prosecutor’s salary. The association is lobbying to get a prosecutor in Broward County.
“Our biggest hurdle is convincing people that this affects everyone,” Tyus said. “We have volunteer [insurance agencies] who don’t want to participate anymore because it’s costing them so much. They have no other choice to pass those costs on to their customers.”
According to figures compiled by the Florida Department of Financial Services, an average of $1 billion worth of injury claims are filed in the state each year, adding about $240 to the average vehicle owner’s annual premium. The average personal injury claim in Florida is about $6,000.
A look at one fraud case
A look at one alleged fraud case dismantled by Smith’s investigators illustrates how bogus claims inflate those figures, he said.
Clinic owner Rolando Martinez, 35, is accused of falsifying medical records of 51 patients. One of the patients, Alberto Morejon, now working with prosecutors, told investigators that recruiter Fausto Guerra, 34, paid him $500 to take part in a staged May 12 fender-bender in Hialeah, according to court records.
A police report of the accident estimated the wreck caused only $200 in damages, and there were no injuries. Yet, court records allege Martinez billed Morejon’s insurance for 36 therapy visits and for five doctor consultations totaling $8,515. Morejon told investigators he went to Martinez’s clinic only twice for a massage, court records show.
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