More Arrests in Conjunction With Florida Insurance Fraud Sting

May 27, 2015

CFO and State Fire Marshal Jeff Atwater, alongside Miami-Dade State Attorney Katherine Fernandez Rundle, announced 30 more arrests made during the second wave of a collaborative state and local operation known as “Operation Flames and Floods.”

The investigation exposed an extensive scheme in which a Miami public adjuster named Jorge Espinosa recruited homeowners to stage fire and water damage claims in residential homes in order to defraud multiple insurance companies. Previously arrested in February 2014 for crimes related to this fraud ring, investigators have since uncovered 25 more fraudulent claims tied to Espinosa, representing total losses of more than $14 million.

Operation Flames and Floods began in November 2012 as a joint investigation between the Florida State Fire Marshal’s Office and the Miami-Dade Police Department’s Arson Unit. In February 2014, 14 people were arrested after 13 homes were intentionally set on fire and five more reported staged water damage. As a result of the fraud, multiple insurance carriers incurred more than $7.6 million in reported losses.

Further investigative efforts uncovered 25 more claims tied to this fraud scheme, representing an additional $6.7 million in fraudulent claims paid by the following insurance companies: Tower Hill Insurance Group, Citizens Property Insurance, Federated National Insurance Company, GEICO, Bankers Insurance Group, Southern Fidelity, Mercury Insurance, State Farm, Florida Peninsula, Ascendant Commercial Insurance, United Property and Casualty, Ark Royal Insurance and Southern Oak Insurance.

“Insurance fraud is not a victimless crime,” said Tower Hill Insurance Group President Don Matz. ”In fact, it impacts insurance policyholders around the state through increased rates that are required to recoup the funds stolen through these fraudulent acts.”

“We applaud the efforts of CFO Atwater’s office and the Miami-Dade State Attorney Katherine Fernandez Rundle, and we are glad to have played a part in this investigation,” said Joseph Theobold, Citizens director of Special Investigations. “Insurance fraud translates into millions of dollars in costs paid by our policyholders. We must remain diligent in rooting out fraud.”

The Sarasota, Lee, Collier and Highlands County Sheriffs’ Offices assisted with last week’s arrests, along with the Florida Fish and Wildlife Conservation Commission.

Source: Florida Department of Financial Services

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