A Bakersfield, Calif., businesswoman and two accomplices have been arrested in California on a list of charges stemming from a variety of alleged fraud.
Shawn Dodd, 40, is charged with four felony counts of insurance fraud, one felony count of workers’ compensation insurance premium fraud, two felony counts of employer tax evasion, one felony count of money laundering, and two felony counts of conspiracy to obtain property under false pretenses. Both her husband, James “Sonny” Dodd, 48, and her mother, Barbara Bayird, 65, face one felony count each of conspiracy to obtain property under false pretenses. All three surrendered at the Kern County Superior Court Jan. 26, 2007 on felony arrest warrants, were immediately arraigned and were released on their own recognizance.
California Department of Insurance’s (CDI) Fraud Division investigators said they received numerous suspected fraudulent claims reports from insurance carriers regarding the billing practices of Shawn Dodd’s businesses: Provident Medical Management, Executive Medical Management, National Chiropractic, Neurosport Chiropractic, Pacific United Medical Group, Old River Medical Center Inc., and Cal-Sport Physical Therapy.
In Oct. 2003, the CUNA Mutual Group Insurance Co. contacted the CDI Fraud Division’s Fresno Regional Office regarding six suspicious disability insurance claims filed by Dodd. The CDI said its investigation revealed that Dodd obtained loans from the Kern Central Credit Union that she used to purchase five vehicles. The vehicles included a 1999 Dodge Viper, a 2000 Mercury Cougar, a 1988 Pace Arrow Motor Home, a 24-foot Kachina Legend boat, and a 2001 Sunsation boat. Dodd also obtained a Visa credit card account from Kern Central Credit Union. At the time she obtained the loans, she purchased a credit disability insurance policy for each of these loans from the CUNA Mutual Insurance Group. Dodd also took out a loan from GMAC Credit Corp. for the purchase of a 2001 Chevrolet Silverado truck, and purchased credit disability insurance for that loan from the Universal Underwriters Insurance Co. On the applications for each of the loans, Dodd listed her occupation as the president/executive officer of Provident Medical Management/ Executive Medical Management, which are the parent companies of each of the above listed medical/chiropractic corporations, CDI said.
On Jan. 4, 2002, Dodd filed claims against each of the credit disability insurance policies which she had purchased alleging that she had suffered back injuries that prevented her from working. In those claims, CDI said Dodd listed her occupation as “receptionist, billing/filing clerk, bookkeeper.” Her disability status for the claims was verified by medical reports allegedly signed by Richard Infante, M.D., formerly employed by Dodd’s Pacific Medical Group. Subsequent investigation revealed that Dr. Infante left Dodd’s employment prior to Dodd’s disability claims and he stated that he had not provided medical treatment since 1999.
During the execution of search warrants upon Dodd’s business and home, a signature stamp for Dr. Infante’s signature was recovered and evidence indicates the stamp was used by Dodd to prepare the medical reports required to make the credit disability insurance claims, CDI sais. CUNA Mutual and Universal Underwriters Insurance Companies paid in excess of $38,000 for the claims, according to CDI. During the execution of the search warrant upon the offices of VIP Medical Plaza/Executive Medical Management in Feb. 2004, Dodd’s employees made statements identifying fraudulent billing practices by Dodd’s companies. Subsequent investigation revealed that during 2003, one of Dodd’s companies, National/Neurosport Chiropractic, billed medical, automobile and workers’ compensation insurance carriers for 8,054 chiropractic adjustments. During that time, Dodd through National/Neurosport Chiropractic employed only one chiropractor, Dr. Courtland Keith. When interviewed, Dr. Keith stated that he had actually performed less than 10 percent of the8,054 five region chiropractic adjustments, according to CDI. The fraudulent upgrading of chiropractic services rendered resulted in the insurance carriers being fraudulently billed more than $210,000 during calendar year 2003 alone, CDI said.
Shortly after the search warrants upon Dodd’s residence and office, a former employee of Provident Medical Management contacted the Kern County District Attorney’s Office and reported that Dodd had denied her workers’ compensation insurance benefits after she was injured while working. The former employee stated that while working for Provident Medical Management as a masseuse, she suffered an occupational injury. The employee completed the requisite forms for a workers’ compensation insurance claim and provided this paperwork to Dodd. For six months, Dodd intentionally failed to forward the completed workers’ compensation insurance claim to her insurer, State Compensation Insurance Fund (SCIF), CDI said. The former employee subsequently retained an attorney and filed her claim directly with SCIF. Dodd’s intentional denial of benefits resulted in losses of $14,381 to SCIF, and $6,756 to Dodd’s former employee. Subsequent investigation also revealed that Dodd had understated the amount of her payroll and misclassified the function of her employees when reporting to her workers’ compensation insurance carrier, SCIF. The purpose of the misrepresentations was to minimize the workers’ compensation insurance premium deposits and monthly premium costs paid by Provident Medical Management. The misrepresentations resulted in a loss of $8,100 to SCIF, CDI said.
Based on information discovered during an investigation by the Employment Development Department (EDD) and the employment tax audit, it was determined that Dodd had charge and responsibility of the medical management company, known as Provident Medical Management Group and Provident Medical Management Group Inc. from Jan. 1, 2001 through June 30, 2003 and filed false quarterly returns for each quarter contained in the audited period, and did so with the intent to evade the provisions of the California Unemployment Insurance Code, (CUIC).
In Nov. 2002, Shawn Dodd instructed her office manager at Provident Medical Management to create fraudulent W-2 and earnings statements or “check stubs” showing that James “Sonny” Dodd was employed by Provident Medical Management and was being paid approximately $96,000 per year. According to the ofice manager, Dodd stated that the statements were being created to allow James Dodd to qualify for a loan to purchase a motor home. On March 7, 2003, James Dodd used the documents to qualify for a loan of $104,000 from the Kern Schools Federal Credit Union. He used this loan to purchase a 2003 Seabreeze Motor home from Venture-Out RV. In 2004, Dodd submitted to a voluntary repossession of the motor home by Kern Schools Federal Credit Union. The vehicle was subsequently sold by the Credit Union for substantially less than the loan’s balance resulting in a loss of $46,000 to the Credit Union, CDI said.
On Aug. 22, 2003, Barbara Bayird applied for a $45,000 loan from the Kern Federal Schools Credit Union. The purpose of the loan was the purchase of a 1999 Chevrolet Corvette. At the time of this application, Bayird was retired from the Kern School Systems and her income was insufficient to qualify for the $45,000 loan. Shawn Dodd’s Provident Medical Management Corp. subsequently issued Bayird an earnings statement which alleged that Bayird was being paid $2,500 per month by the company. Based solely on this alleged secondary income, the Kern Schools Federal Credit Union issued the loan to Bayird which she used to purchase the Corvette. Investigators subsequently determined that the earnings statement was fraudulently produced at Shawn Dodd’s direction solely for the purpose of allowing her mother, Barbara Bayird to qualify for the vehicle loan, CDI said.
The Kern County District Attorney’s Office is prosecuting the case. If convicted, Shawn Dodd faces a potential maximum sentence of up to 11 years and eight months in state prison and a $100,000 fine. Both James “Sonny” Dodd and Barbara Bayird, if convicted, face a maximum of three years in state prison.
Assisting in the investigation were the California Employment Development Department’s (EDD) Investigations Division, the National Insurance Crime Bureau, State Compensation Insurance Fund (SCIF) Fraud Interdiction Program, and the Special Investigations Units of GEICO, State Farm, CUNA Mutual, and Blue Cross Insurance Companies.
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