Insurance fraud is one of America’s largest crimes — at least $80 billion is stolen each year. Why should you care? This is a crime that you pay for in the form of higher insurance rates, for one thing. And often, the fraud includes theft, scams, staged accidents, and even violence. According to the Insurance Information Institute (III), this is who commits insurance fraud:
- organized criminals who steal large sums through fraudulent business activities,
- professionals and technicians who inflate service costs or charge for services not rendered
- ordinary people who want to cover their deductible or view filing a claim as an opportunity to make a little money.
Insurance fraud is a crime and police and insurance investigators fight back. It’s punishable by fines, jail and permanent criminal records. Unfortunately, sometimes the general public thinks of it as a petty or victimless crime. III says:
“Public attitudes have sometimes hampered insurers in their fight against fraud. Studies suggest that some portion of insurance fraud committed by consumers is driven by revenge or retaliation for a personal service exchange which they think is unfair. People may retaliate in order to “get a return” or “get their money’s worth.”
Understanding the scope of the crime and the ways that it affects all of the honest folks who pay for this crime can educate and help to change attitudes.
The Coalition Against Insurance Fraud works hard to educate the public about how insurance fraud is not a minor or a victimless crime. Every year, they profile some of the worst crooks, cons and criminals from the prior year in the Insurance Fraud Hall of Shame. Here are some of the worst fraudsters in 2019:
- A Tallahassee man pushed his friend out of a fishing boat and told authorities alligators must have gotten him. In reality, he had shot his friend in the face as he tried to climb back in the boat and then buried his body. It turned out he was in cahoots with the deceased man’s wife to collect $1.75 million in life insurance.
- A NY chiropractor was at the heart of a “slip and fall” shakedown ring that bilked businesses and their insurers out of $32 million for bogus injuries.
- A wealthy Miami executive ran dozens of corrupt skilled-nursing and assisted-living facilities that raided taxpayer-funded Medicare and Medicaid to the tune of $1.3 billion.
- An heiress, socialite and political fundraiser made $20 million of false damage claims after fire in her family’s 5,600-foot mansion in the Philadelphia suburbs. To add insult to injury, she falsely blamed volunteer fire fighters who fought the fire of stealing $10 million in jewelry.
- A Boston-area trolley driver was badly beaten up by a masked criminal on Halloween and collected workers compensation and long-term insurance to cover his injuries. Investigators later tracked down the mugger who turned out to be friend of the driver who had helped stage the “crime.”
- There are more: A Pennsylvania man who died of burns when his home arson scam went wrong. A corrupt rehab network that forced desperate addicts to relapse in a $100-million plot to milk insurers in Pennsylvania. A staged workplace slip and fall that was caught on camera and then went viral. A $2.1-billion transnational crime ring that targeted seniors.Read more about detail about the stories of the 2019 inductees in the Insurance Fraud Hall of Shame.