A Roundup of Fraud Activities Reported Across the Southeast

Carmelo Sanfei and William Paul Crouse, accused by Florida’s Department of Financial Services of bilking more than 7,000 Floridians of more than $2.5 million in unpaid insurance bills, have pleaded guilty to charges of racketeering and unlawful transaction of insurance. Formal sentencing of both defendants will be held in September before Ninth Judicial Circuit Judge Julie H. O’Kane in Orlando.

According to Florida Attorney General Charlie Crist, Zandei and Crouse were apprehended when DFS determined the firm they headed, TRG Marketing, had a self-insured plan that was under-funded and failed to pay millions of dollars in medical claims.

Crist said the terms of their plea agreements require them to pay full restitution to victims amounting to at least $2.5 million. After they serve their terms they will be under 20 years of supervised probation.

Crouse pleaded guilty to racketeering and four counts of unlawful transaction of insurance and will serve four years in prison.

Zandei pleaded guilty of conspiracy to commit racketeering and four counts of unlawful transaction of insurance. According to Crist, Zandei will serve two years in prison.

Zanfei and Crouse marketed the plan in 44 states, although Florida was the only state that pursued criminal charges,

Crist said.

Testimony in Hurricane Fran-ces Fraud Case Begins

U.S. District Court Judge Cecilia Altonaga recently heard testimony in a trial in which the defendant, Daniel Bellegarde, a resident of Homestead, Fla., allegedly bilked the Federal Emergency Management Agency of more than $11,000. The case is the first federal trial to arise out of alleged disaster relief fraud in Miami-Dade County in the wake of Hurricane Frances.

A jury of seven men and five women were sworn in, some of whom told the court they had suffered property damage during Hurricane Andrew but not during Frances.

Bellegarde allegedly filed false claims with FEMA saying that his home and furnishings were damaged by flood waters contaminated by raw sewage.

Altonaga was among 14 people a federal grand jury accused of disaster relief fraud in a series of indictments in March.

Sweep Results in Arrest of 28 Workers’ Comp Violations

A three-day statewide sweep resulted in 28 arrests of suspects arrested for violations of Florida workers’ compensation laws. The sweep is the latest move in a campaign to root out workers compensation system cheaters who make it more expensive for honest employers to obtain coverage. The investigations and the arrests were carried out by detectives from the Division of Insurance Fraud, Bureau of Workers’ Compensation Fraud, in the Department of Financial Services, which Florida CFO Tom Gallagher oversees.

A majority of the suspects were arrested in the early morning hours at their residences. The individuals were arrested on charges that include submitting fraudulent workers’ comp claims, forging workers’ comp documents or exemptions, violating orders to stop work until adequate coverage is obtained and failure to secure coverage. Most of those arrested are facing third-degree felony charges, which carry a penalty of up to five years in prison per count. However, some individuals are facing charges that carry up to 30 years in prison, and some are on probation for prior violations.

N.C. Officer Faces Numerous Fraud Charges

Concord, N.C. Police Officer Dana Lynn Beninati was suspended without pay after allegedly passing fake prescriptions
and billing her insurance company. Lynn was arrested at her home and charged

with 23 counts of prescription and insurance fraud and one count of attempted
prescription fraud.

According to Police Chief Merl Hamilton, a Concord physician called police on May 20th and said Beninati might have filled illegal prescriptions for hydrocodone, a narcotic painkiller, at several pharmacies.

FEMA Worker Awaits Trial

A state worker assigned to process Federal Emergency Management Agency claims, and who was indicted in Miami in 1998 for planning to steal nearly $48,000 in bogus hurricane claims, has been returned from Panama to the United States.

Rafael Montejo, recruited friends and relatives to file bogus disaster relief claims after Hurricane Andrew. In November 1998 he fled to Panama after failing to comply with a grand jury subpoena requiring him to provide his fingerprints and a handwriting sample, court records state. The FBI listed Montejo as one of its most-wanted individuals and posted his picture on the Internet.

According to the indictment, Montejo, a government analyst, determined eligibility for FEMA’s Individual and Family Grant program after Hurricane Andrew. At the time, the program was administered by the state Department of Health and Rehabilitative Services, and Montejo functioned as an assistant to the program’s director, court records indicate.

The program provided up to $11,500 per applicant for housing, transportation, personal property, medical and dental bills, and funeral expenses.

According to the Fort Lauderdale Sun-Sentinel, Montejo recruited friends, acquaintances and relatives to call a FEMA hotline and apply for aid in the name of a previous existing applicant, the indictment states. While the additional claim was pending, Montejo filed a change of address form for the supposed applicant, providing a fake address or the address of one of his associates, according to the indictment.

The checks “were eventually retrieved and controlled” by Montejo, as were checks returned as undeliverable because of the false addresses, the records state.

Fourteen aid recipients were indicted in March for wire fraud for filing false claims.

Floridians Charged with Stag-ing Accident, Filing False Claim

Two Broward County men face felony fraud charges after a state investigation determined they staged an accident in January and then filed fraudulent insurance claims for injuries that did not occur.

Jesse Demetro, 20, of Hallandale, and Anthony Nicholas, 20, of Ft. Lauderdale, each face charges of organized scheme to defraud, insurance fraud and second-degree grand theft. The charges follow an investigation by the Florida Department of Financial Services, Division of Insurance Fraud. If convicted on the charges, each could face up to 50 years in prison.

Detectives found that Demetro and Nicholas conspired and participated in a staged accident on January 27, 2004, in Broward County, and were tested and treated at Plantation General Hospital. As a result, they filed an insurance claim for medical expenses with Republic Western Insurance Co. and received benefits totaling more than $12,800. They also filed a claim for more than $17,000 in damage to a 2003 Mercedes Benz.

Ga. Suspects Claimed “Dumped” Pickup Was Stolen

Three Warner Robins, Ga., suspects were apprehended and accused of allegedly driving a truck into the Flint River in Crawford County and then claiming it was stolen.

Lindsey James Adams, 24, of Warner Robins, Ga., and Clifford “C.J.” Jackson Jr. 24, of Byron, Ga., have been apprehended for assisting Felix Thorn, 25, of Warner Robins, in a scheme to file a fraudulent insurance claim.

Thorn allegedly reported that his 1998 Chevrolet 1500 pickup had been stolen July 26 from the road in front of his home in the gated community of Huntington Hills off Wellborn Road in Warner Robins.

Later, police got a tip that the truck, valued at $8,000, had been dumped into the river. A dive team with the Warner Robins Fire Department subsequently found the vehicle.

Miami Man Sold Bogus Discount Plan

Florida’s Chief Financial Officer Tom Gallagher announced the arrest of an individual involved in defrauding hundreds of Floridians in a discount health plan fraud ring. Enrique Angulo, 41, of Miami-Dade County, was arrested by investigators from the Department of Financial Services, Division of Insurance Fraud.

Angulo, presently on four years probation for grand theft in excess of $20,000, was arrested, charged with violation of probation, as well as second-degree grand theft, uttering forged instruments, and organized scheme to defraud. After his arrest, Angulo was held at the Miami-Dade County Jail without bond. If convicted, Angulo faces a maximum of 25 years in prison.

Angulo purchased Americ Health Benefits, a Discount Health Plan in December 2004 after its owner was arrested and jailed on separate charges of insurance fraud. In January 2005, Angulo realized the business he purchased was a front for criminal enterprises and had no legitimate use. Rather than close the business, he too began defrauding unwilling consumers.

This particular scam worked like this: A consumer would come to Americ Health Benefits to buy a low-cost health discount plan. As part of the registration process, Angulo would request voided or blank checks from the consumer. In addition to charging customers for a discount plan he knew he could not provide, Angulo would create check drafts to withdraw the monthly membership fees from the victims’ accounts.

One victim discovered the health insurance policy she was paying for was worthless after seeking medical attention for her husband and son. The victim was left with more than $15,000 dollars in hospital bills after her calls to Angulo went unanswered. Up until his arrest, Angulo continued to withdraw monthly membership fees in excess of $5,000 from a closed account in the victim’s name.

Applicant Charged With Fraud

A man who allegedly lied on his application for disability income insurance and then filed a claim one week after getting the policy is facing felony charges of application fraud, first-degree grand theft and first-degree insurance fraud.

Bruce Sutherland, 43, was arrested on the charges following an investigation by the Department of Financial Services, Division of Insurance Fraud. He has a real estate license but claimed he was unable to work due to panic attacks. If convicted on the charges, he could face up to 65 years in prison.

The investigation began after the Illinois Mutual Life Insurance Company forwarded information that indicated Sutherland misrepresented information about his occupation, income, and medical history on an application for disability income insurance.

Department detectives said medical and hospital records confirmed that Sutherland provided false information regarding his medical history, and documents from the Social Security Administration indicated he provided false salary information as well.

Based on his application, Sutherland was issued a Disability Income Policy that provided a monthly disability benefit of $3,000 until he turned 65. Sutherland’s maximum benefit for disability would have been approximately $828,000. The claim ultimately was denied.

Fla. Lawyer Faces Fraud Charge

A Sarasota, Fla. attorney is facing an insurance fraud charge after state fraud investigators documented that he had continued to work while collecting more than $130,000 in disability benefits.

Peter W. Martin, 58, surrendered on the charge at the Sarasota County Jail and was released on a $2,500 bond. The charge was based on an investigation by the Department of Financial Services, Division of Insurance Fraud. If convicted, Martin faces up to 15 years in prison in addition to fines and restitution.

The investigation, based on a referral from Northwestern Mutual Life Insurance Company, uncovered that Martin submitted false information on a disability claim. Martin reported that, following a motor vehicle accident, he became partially disabled and that his condition deteriorated making him totally disabled in September of 2003.

Fraud investigators found that Martin had continued to practice law in Florida as well as New York while he was collecting disability benefits from July 2003 through February 2004.