Fla. Investigators Arrest Four Citizens Customers for Making $170,000 in False, Inflated Damage Claims

July 26, 2005

Department of Insurance investigators arrested four Miami-Dade County residents on charges of submitting false or inflated damage claims to Citizens Property Insurance Corp. totaling more than $170,000. The state’s insurer of last resort faces a $516 million shortfall, and according to Justin Glover, a Citizens spokesman, “the company will do what it can to recover the money.”

“You go through the legal system and you hope for a judgment to have that returned,” Glover told the South Florida Sun-Sentinel.

Investigations are continuing in at least 42 cases of suspected insurance claims fraud throughout Florida, according to Nina Banister, a spokeswoman with Florida’s department of Financial Services, which oversees the state’s Insurance Fraud Division. She predicted there would be at least two more arrests in Miami-Dade County during coming weeks. Citizens is the largest insurer in the county.

Insurance Journal reported yesterday that one of those arrested included Joyce Chandler of Coral Gables, who was charged with one count of grand theft and two counts of insurance fraud. Investigators said Chandler, 54, wrote a letter on behalf of a Miami property owner, claiming she was the person’s minister and the home was destroyed by a tornado.

When the claim was denied, investigators said Chandler acquired the property and submitted a claim for more than $94,000 for repairs and additional living expenses, even though she wasn’t living there at the time.

Julio Iriarte, a licensed public adjuster in Miami, was charged with two counts of insurance fraud, two counts of grand theft and one count of organizing a scheme to defraud. Iriarte, 26, allegedly submitted false contractor agreements that led to claims being overpaid by at least 20 percent, Banister said.

Also arrested were Adrianna Kelly Francis, 58, and Debra Anita Kelly, 41, both listed as having the same Miami address. They were both charged with one count of grand theft and one count of insurance fraud. Additional details weren’t given on their arrests.

According to officials, all had been released from jail Monday. That the arrests come nearly a year after the first of four hurricanes hit the state isn’t unusual, considering that roughly 2 million claims were filed statewide, Ron Poindexter, the National Insurance Crime Bureau’s director of operations for the southeastern United States told the Sun-Sentinel. The bureau is a nonprofit group that partners with insurance companies and law enforcement agencies on insurance fraud cases.

It took between five and seven years to handle the fraud cases from Hurricane Andrew in 1992, Poindexter said. The bureau currently has 200 referrals of suspected fraud activity, either from insurance companies or tips that people called in, he said.

“What we expect is that in the next two to three years, it will peak up to its highest peak,” Poindexter said. “This 200 could turn up into, unfortunately, 1,000.”

Poindexter estimates that at least 5 percent of the claims submitted after last year’s storms could prove to be fraudulent.

Typically, insurance adjusters flag claims they suspect could be fraudulent, and each company’s fraud investigators will determine whether there is enough evidence to prove a claim is suspect. Insurance companies are required by state law to turn over suspected fraudulent claims to state investigators, Banister said.

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