| Convictions | 164 |
| Individuals Indicted | 146 |
| Complaints Issued | 192 |
| Cases Referred for Prosecution | 333 |
Attorney General Scott Harshbarger and the Insurance Fraud
Bureau of Massachusetts invite you to attend a seminar on the
Investigation of Automobile Glass and Body Shops
November 8, 1996; 8:00 a.m. - 4:00 p.m.
Agenda includes:
REGISTRATION MUST BE RECEIVED BY OCTOBER 30, 1996
For additional information, please call Deborah Terry, (617) 439-0439.
PREMIUM AVOIDANCE HIGHLIGHTS
"Scheme to Save Over $637,000 Ends in Conviction"
Case Update
NEW HAMPSHIRE- The president of a New Hampshire temporary
work service company intentionally misclassified employees as
independent contractors rather than employees of his company.
The misclassification allowed him to avoid paying $211,201 in
employer taxes over a three year period. In addition, the subject
provided Liberty Mutual Insurance Company with false information
on the number of actual people he employed, thereby evading $426,463
in workers' compensation premiums.
Michael Bardzick, president of Golden Labor Service,
Inc., pled no contest in Middlesex Superior Court on April
2, 1996. He was sentenced to serve 30 days in the House of Correction
and ordered to pay $53,000 restitution to the Department of Employment
& Training for six DET tax counts. He was sentenced to 3-5
years in MCI-Cedar Junction, suspended, and ordered to pay $91,000
to Liberty Mutual for two workers' compensation premium evasion
felony counts. Assistant Attorney General Joshua Krell prosecuted
the case with assistance from Investigator Edward Regan of Attorney
General Harshbarger's Office.
"Framingham Contractor Cheats for $1 Million" Case
Update
FRAMINGHAM- A Framingham contractor hired workers for five
public works projects but neglected to classify the workers as
company employees. As a result, the company avoided paying almost
$1 million in workers' compensation premiums and unemployment
taxes.
Eastern Contractors pled no contest to a charge of avoiding
workers' compensation insurance premiums in Middlesex Superior
Court on May 24, 1996. The company was ordered to pay $300,000
in restitution to ITT Hartford for back premiums and to pay $102,000
in restitution for back wages, unemployment taxes and costs. As
a condition of probation, Eastern was prohibited from bidding
on any public works projects for three months. Its subsidiary,
East Coast Construction, pled guilty to one count each
of failing to pay overtime wages, failing to pay the prevailing
wage rate and failing to maintain true and accurate payroll records.
East Coast was fined $4,000 and debarred from public works projects
for six months. Assistant Attorneys General John Ciardi and Bruce
Trager prosecuted the case.
All in the Family
CHICOPEE- The owner of an excavating and trucking company
repeatedly told his employees to consult their own physicians
if they were injured on the job and he would pay their medical
expenses. The owner requested that they not file claims if injured
because it would increase his workers= compensation rate. During
the construction of a housing project for elderly residents, the
owner did pay the medical bills for several employees who suffered
work-related injuries. In another aspect of the case, his wife,
the office manager of the company, informed Aetna Insurance that
her father-in-law was working in a position that was in a lower
job classification than the actual job he was performing for the
company.
Complaints were issued against a Chicopee excavating/trucking
company, its owner and the office manager on a total of 26 counts
of insurance fraud-related allegations in Worcester District Court
on May 16, 1996. The case is being prosecuted by AAG Bruce Trager.
Fraudulent Certificates Exchanged for W/C Coverage
BOSTON- A Quincy man allegedly conceived a fraudulent scheme
to assist various courier/messenger companies to avoid paying
workers' compensation insurance premiums by providing them with
forged insurance certificates. The subject convinced owners of
the courier/messenger companies that if their employees would
join the subject's company, employers could obtain workers' compensation
insurance certificates free of charge for their employees. The
certificates are allegedly worthless and forged by the subject
himself. The employees were each charged approximately $200 per
year in dues by the subject company.
A Quincy man was indicted in U.S. District Court on eight counts
of mail fraud and seven counts of wire fraud on August 1, 1996.
The case is being prosecuted by Assistant U.S. Attorney Paul Levenson
of the Office of United States Attorney Donald Stern.
Payroll Discrepancy Saves $60,000
BROCKTON- An Everett corporation, certified by the State
Office of Minority and Women's Business Assistance, allegedly
employed union workers on asbestos removal and demolition construction
projects during 1993 and 1994. They were allegedly provided with
workers' compensation coverage through ITT Hartford. The owner/president
of the corporation allegedly distorted payroll amounts for these
two years when she reported the totals to the carrier's auditor
for calculation of the premium payment. The owner reported approximately
$145,000 in payroll for the two years combined. It is alleged
that the payroll amounts actually totalled over $775,000 for the
two years. The alleged discrepancy saved the company more than
$60,000 in additional insurance premiums.
An Everett company and its owner/president were indicted on
charges of larceny and workers' compensation fraud in Norfolk
Superior Court on October 2, 1996. Assistant Attorney General
Molly Parks is prosecuting the case. She is assisted by Investigator
John Crimmins of the AG's Public Protection Bureau.
HEALTH HIGHLIGHTS
"Podiatrist Practices Fancy Footwork" Case Update
MANSFIELD- A Mansfield podiatrist submitted fraudulent
billing statements for services not rendered and false health
insurance claim forms to Mega Life, Prudential, Travelers and
John Hancock Insurance Companies. The doctor also inflated the
number of procedures performed on actual dates of service for
patients he did treat at his office.
On April 16, 1996 Joel Korins pled guilty to insurance
fraud, larceny, filing false health care claims and conspiracy
in Bristol Superior Court. He was sentenced to two years in the
House of Correction, suspended, $16,072 in restitution and voluntary
surrender of his license to practice podiatry. He cannot reapply
for a license for ten years. Assistant Attorney General Jennifer
Renna Ferreira prosecuted the case.
PROPERTY HIGHLIGHTS
Claims Rep Pads Homeowners Claim
WORCESTER- A Liberty Mutual claims representative filed
a claim under her homeowner's policy with Worcester Insurance
Company reporting that her home had been burglarized and that
numerous items had been stolen. Her itemized list included a television,
camera and gold ring. When the Worcester woman was unable to produce
receipts for the stolen items, the insurance carrier hired a private
investigator. She allegedly admitted to the investigator that
she had "padded" her claim by listing the gold ring
as stolen. As part of the claim, she also sought compensation
for new door locks, yet allegedly confessed to police and the
insurance company that the back door had been unlocked at the
time of the alleged burglary.
A complaint was issued against a Worcester woman on one count
each of insurance fraud and attempted larceny in Worcester District
Court on June 19, 1996. The case is being prosecuted by Assistant
Attorney General John Ciardi and Special Assistant Attorney General
Christian Hatfield.
MARINE HIGHLIGHTS
"Two Halves Don't Necessarily Make a Whole" Case
Update
ACUSHNET- Two men reported that a 40-foot O'Day sailboat
worth $85,000 that they had restored was stolen. Investigation
revealed that two O'Day sailboats, each with existing damage,
had been purchased by the men. One boat was severely damaged on
the left side and the other was damaged on the right side and
the two salvaged sailboats were pieced together to make one. The
non-existent "paper" boat was registered, insured and
then reported stolen in an attempt to collect the insurance proceeds
from Maryland Insurance Group.
Kurt Blaha pled guilty to charges of insurance fraud
and filing a false report of theft in Hingham District Court on
May 7, 1996. He was sentenced to one year probation. His friend,
James Laycock, pled guilty to insurance fraud, making a
false affidavit or protest on a ship or vessel, attempt to commit
a crime and conspiracy. He was sentenced to 18 months in the House
of Correction, suspended for two years, and ordered to perform
250 hours of community service. The case was prosecuted by Assistant
Attorney General Kevin Brekka.
AUTOMOBILE HIGHLIGHT
"Like Father, Like Son" Case Update
SEEKONK- A Seekonk businessman reported the theft of his
company-owned BMW, office equipment and tools and received $29,000
from Hanover Insurance Company for the loss.
Wayne Clark, Sr. pled guilty to charges of insurance
fraud, perjury and larceny in Bristol Superior Court on June 24,
1996. He was sentenced to 36 months in the House of Correction,
18 months to serve, and ordered to pay restitution and fines of
$30,000. His son previously pled guilty for the staged theft of
a family-owned BMW and was sentenced to a suspended sentence and
ordered to pay $7,500 restitution. Assistant Attorney General
Stephanie Kelly prosecuted the case.
"Claims Adjuster Authorizes False Checks" Case Update
ROSLINDALE- A former USF&G claims adjuster added names
to the claims of legitimate motor vehicle accidents and issued
checks totalling more than $13,000 to these individuals. Her brother
provided the adjuster with the names of individuals who were willing
to participate in the scheme. He then accompanied them to cash
their checks, allowed them to keep a few hundred dollars and shared
the remaining cash with his sister.
Pamela Lodge Simpson pled guilty to insurance fraud,
larceny, forgery and conspiracy on June 18, 1996 in Quincy District
Court. She was sentenced to one year in the House of Correction,
suspended, and ordered to pay $13,537 restitution and to perform
250 hours of community service. Her brother, Michael Lodge,
pled guilty to insurance fraud, larceny and conspiracy. He is
currently serving a life sentence for a first degree murder conviction.
The case was prosecuted by Assistant Attorney General Anne C.
Berlin.
Oh, No! Not Again!
CAMBRIDGE- A 1983 Porsche 928 owned by a Cambridge man
was allegedly involved in three separate motor vehicle accidents.
In each incident, another vehicle allegedly backed into the Porsche
causing front end damage. Photographs and appraisals from the
carriers, John Hancock, Metropolitan Property & Casualty and
Cigna Property & Casualty, show identical damage inflicted
upon the vehicle.
A Cambridge man was indicted on charges of insurance fraud,
larceny and conspiracy on June 19, 1996 in Middlesex Superior
Court. A complaint was issued against his sister on counts of
insurance fraud and conspiracy in Cambridge District Court. Another
subject pled guilty to his role in one of the staged accident
schemes. He was sentenced to a suspended sentence and fined $3,000.
Assistant Attorney General Jennifer Renna Ferreira is prosecuting
the case.
"Taxi Service Prohibited for Personal Autos" Case Update
LAWRENCE- Two Lawrence taxicab drivers paid insurance premiums
based solely on personal use of the vehicles they operated as
taxicabs. They paid minimum personal insurance on their vehicles,
about $1,000, when they should have paid the proper, higher rate
for taxicabs which was almost $4,000.
Jose Santiago was found guilty of insurance fraud and
larceny in Lawrence District Court. He was fined $250. Nicholas
Balbi admitted to sufficient facts and was fined $1,000. The
case was prosecuted by Assistant Attorney General John Ciardi
and Special Assistant Attorney General Christian Hatfield.
"But My Garage Really is Located on the Other Side of the State!"
Case Update
LAWRENCE- A Lawrence woman owned two vehicles garaged in
Lawrence but claimed to Safety Insurance Company they were garaged
in Methuen. Because insurance rates are less expensive in Methuen,
she saved $491 in insurance premiums on each car.
Griselda Tejada Vasquez admitted to sufficient facts
to support a guilty finding of insurance fraud and larceny in
Lawrence District Court. She was ordered to pay $567 in restitution
and $567 in court fines. The case was handled by Assistant Attorney
General John Ciardi and Special Assistant Attorney General Christian
Hatfield.
Stolen Vehicle Located in Virginia
REVERE- A Revere man reported to Cigna Property & Casualty
Insurance Company and to police the alleged theft of his vehicle
from the Burlington Mall in Massachusetts. Investigation by a
Virginia state trooper, however, revealed that the subject=s vehicle
caught fire while he was driving it to Virginia. The vehicle was
allegedly towed to and given to the subject=s brother in that
state who then had the vehicle towed to and stored at the tow
company. The tow company ran a vehicle check when the automobile
was left in their possession without proper payment of storage
charges and discovered that the vehicle had been reported stolen
in Massachusetts.
A complaint was issued on May 14, 1996 against a Revere man
alleging motor vehicle insurance fraud, larceny, concealment of
a motor vehicle to defraud the insurer, conspiracy and perjury
in Chelsea District Court. A complaint was also issued against
the subject's sister on motor vehicle insurance fraud, larceny,
concealment of a motor vehicle and conspiracy for her involvement
in the scheme. Assistant Attorney General Sean Kealy is prosecuting
the case.
Gigantic Tow Bill
REVERE- A Revere man allegedly filed claims and received
payments from two different carriers, Aetna Casualty & Surety
and Cigna Property & Casualty, for the same damage to his
truck. As part of each claim, the subject allegedly submitted
identical bills to recover money for a rental vehicle and towing
charges. The tow bill, totalling $6,545, was allegedly fraudulently
created with the help of a friend.
On April 23, 1996 in Chelsea District Court a complaint was
issued against a Revere man for insurance fraud, larceny, attempted
larceny and conspiracy. Another complaint was issued against a
Peabody man for insurance fraud and conspiracy. Assistant Attorney
General Jennifer Renna Ferreira is the prosecutor in the case.
Bully Commits Insurance Fraud
PLYMOUTH- A Plymouth man claimed that he was operating
a friend's vehicle when it was rear-ended by another vehicle.
As part of his claim, the subject furnished a Wage Verification
Form alleging wages earned. Investigation and witness testimony
contend that the Wage Verification Form is a forgery and was actually
signed by the friend. The subject allegedly admitted to an eyewitness
that he had left his job prior to the accident. The friend and
owner of the vehicle admitted she signed the subject's former
employer's name because she felt intimidated by the subject and
had at one time secured a restraining order against him.
A complaint was issued against a Plymouth man on insurance
fraud and attempted larceny in Plymouth District Court on April
2, 1996. Assistant Attorney General Steven Thomas is prosecuting
the case.
WORKERS' COMPENSATION HIGHLIGHTS
Broken Ankle Didn't Break This Worker's Earning Capacity
MARBLEHEAD- A slip and fall accident at his place of employment
resulted in a Dedham man breaking his right ankle. The subject
collected over $30,000 in total temporary workers' compensation
benefits from Cigna Insurance Company for the injury. Evidence
uncovered showed that the subject worked for and was paid over
$80,000 by three different employers during the time period he
was receiving the workers' compensation benefits. The subject
stated during several IMEs that he had not returned to work in
any capacity since the date of the accident.
A Dedham man pled guilty to larceny and was sentenced to two
and one half years in the House of Correction, suspended, and
probation. He was also ordered to pay $14,000 in restitution.
The case was prosecuted in Essex Superior Court by Jennifer Renna
Ferreira of the Attorney General's Office.
CPA Convicted of Workers' Comp Fraud
MANOMET-A Manomet certified public accountant claimed to
be disabled due to an injury he suffered when he worked for Ticor
Title Company in Boston. Investigation revealed, however, that
the subject worked at two similar jobs for other employers while
collecting over $32,000 in total disability benefits from Cigna
Insurance Company.
Harry Honan, a certified public accountant, was found
guilty of insurance fraud and larceny in Brockton Superior Court
on August 26, 1996. He was sentenced to serve three months in
the House of Correction, three years probation and to pay restitution
of $32,936. The trial lasted for five days and the jury deliberated
for three hours before returning a guilty verdict. Assistant Attorneys
General Michael Cullen and Anne Berlin prosecuted the case.
"Security Manager Caught Stealing $97,000" Case Update
LOWELL- As a result of shoulder and back injuries sustained
in an automobile accident, a Lowell man received over $97,000
in temporary total disability benefits from his job as the owner
of a security company. He was actually employed for several months
during the time he collected benefits as the security and maintenance
manager of a self-storage facility and was also running a mail
order business out of his home. He submitted statements to Continental
Insurance Company claiming that he was not working while he was
receiving the benefits.
Richard DiChiara pled guilty to workers' compensation
fraud, insurance fraud and larceny in Middlesex Superior Court
on May 6, 1996. He was sentenced to serve three months in the
House of Correction, three-to-five years in state prison, suspended
for two years, probation, and to perform 100 hours of community
service. DiChiara was also ordered to pay over $90,000 in restitution
through a civil proceeding. Assistant Attorney General Kevin Brekka
prosecuted the case.
"Keeping His Brother's Memory Alive" Case Update
SPRINGFIELD- A subject sustained a work-related injury
while in the employ of a roofing company. Maryland Casualty Insurance
Company paid him temporary total disability benefits for almost
a year when he was then assigned an earning capacity and received
partial disability benefits until the benefits were discontinued.
During several IME's, the subject stated that he had not returned
to work since the date of the accident. However, investigation
revealed that he was employed as a roofer for sporadic periods
during his time of disability and was using the identity of his
deceased brother.
A Springfield man pled guilty to insurance fraud, larceny and
procuring a false certificate of registration in Springfield District
Court on April 9, 1996. He was sentenced to two years supervised
probation and restitution. Assistant Attorney General Steven Thomas
prosecuted the case.
$30.00 per person
Holiday Inn, Taunton, Massachusetts