Tag Archives: Staged accidents

Operation Sledgehammer I-VI Arrests Climb to 92

Six participants in a staged automobile accident ring that operated between October 2006 and December 2012 were sentenced this week by U.S. District Judge Kenneth A. Marra, according to the U.S. Attorney’s Office for the Southern District of Florida.

Almost $10 million in restitution is sought from the six leading defendants, along with jail time followed by three years of supervised release.  The individuals sentenced include:

Elias Sebastian Munguia, 41, Miami clinic owner
- $3,491,516.93 in restitution and 102 months in prison

Yenisleydi Ramos, 26, West Palm Beach secretary
- $1,666,028.08 in restitution and 50 months in prison

Oscar Montiel Martinez, 34, Lake Worth staged-accident participant, recruiter and check casher
- $1,359,208.73 in restitution and 76 months in prison

Teresita Mena, 52, West Palm Beach staged-accident participant, recruiter and check casher
- $1,321,459.87 in restitution and 66 months in prison

Aleida Capdevila, 62, West Palm Beach clinic office worker
- $1,039,928.19 in restitution and 53 months in prison

Juan Francisco Avon, 62, Miami licensed massage therapist
- $866,801.60 in restitution and 38 months in prison

Amaury Tomas Contino, 30, a Lake Worth staged-accident recruiter, filed a guilty plea in the matter. He faces up to 20 years in prison for each of multiple counts, including mail fraud.

The elaborate automobile insurance fraud scheme involved staged accidents, followed by unnecessary or fraudulent medical treatments at clinics run by participating owners, including defendant Munguia. False insurance claims for medical services not needed or never provided were submitted for payment.

The scheme grew as the “true owners” of chiropractic clinics recruited individuals with the medical or chiropractic licenses required by the state of Florida to establish new clinics and act as “nominee owners.”  Ultimately the network grew to include 21 clinics.

The scheme worked so well for a while that additional participants were hired to launder the stream of cash generated from the false claims.

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Filed under Insurance Fraud

Leading Forms of Auto Insurance Fraud

In an article titled “6 Shadiest Auto Insurance Fraud Schemes,” financial publisher Bankrate.com identifies the most popular scams behind false claims submitted to auto insurance carriers:

Staged Accidents. The NICB reports that staged accidents grew by 102 percent between 2008 and 2011. As readers of this blog know, staged accidents are one of the leading forms of auto insurance fraud in South Florida.

Insurance Agent Fraud. Some unscrupulous insurance agents steal insurance premiums that insureds think are being applied to the purchase of auto insurance, warns the Coalition Against Insurance Fraud. The best defense here is to work with nationally recognized insurance carriers and their agents.

Auto Premium Evasion. Insureds also try to defraud their auto insurance carriers. Common techniques include giving a false residential address in a lower-cost insurance zone, or failing to identify new drivers in the family.

Counterfeit Air Bags. Cars that are repaired following an accident, as well as used cars being resold, may make false claims about the presence of functioning air bags. Insurers and purchasers think they are paying for safe air bags, but find out too late that this is not the case.

Windshield Replacement. Glass company representatives who approach auto owners on an unsolicited basis and offer to replace a car’s windshield in exchange for insurance information frequently do an inferior job while also planning to use the insurance policy data to submit false claims.

Tow Truck Fraud. Independent tow trucks that cruise streets and highways looking for accident victims may leave the driver with unexpectedly high towing fees while towing cars to lots in dangerous neighborhoods.

U.S. insurance fraud overall is estimated to cost $80 billion annually, according to the Florida Department of Financial Services, ultimately increasing premium costs for insureds and carriers.

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Filed under Insurance Fraud

Parkland Chiropractor Pleads Guilty to Insurance Fraud in Staged Accident Ring

A Parkland chiropractor, who prosecutors said approved treatments for patients who fraudulently claimed they were victims of car accidents, pleaded guilty to five criminal charges in connection with an extensive staged-accident insurance fraud ring in South Florida, dubbed Operation Sledgehammer VI.

Court records show that Lawrence Schechtman, the 45-year old chiropractor who worked at clinics in Palm Springs and Miami, pleaded guilty to one count of mail fraud conspiracy and four counts of mail fraud, occurring between 2009 and 2012.

Co-conspirators in the scheme were found to have prescribed and bill for treatments that were unnecessary or never provided to the ‘victims’ who were sent to these clinics after the staged accidents. Complicit employees then submitted false claims to the insurance companies for payment.

According to an article in the Sun Sentinel on December 9, Schechtman is scheduled to be sentenced on March 3, 2014.  He could face time in prison and fines, in addition to paying restitution of between $1 million and $2.5 million.

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Filed under Fla. Stat. 627.736 (2008), Insurance Fraud

MGA Insurance Granted Summary Judgment in PIP Staged Accident Case

In an August 15, 2013 decision in Miami-Dade County Court, Defendant MGA Insurance Co. was granted Summary Judgment against Plaintiff Febre’s Medical Center on the grounds that no genuine issue of material fact existed, and Defendant was entitled to Final Judgment as a matter of law.

Plaintiff Febre’s Medical Center received reimbursements from Defendant MGA under the Florida PIP statute for treatment rendered at its clinic. Plaintiff rendered this treatment as part of a scheme to defraud Defendant and other insurance companies through the use of “staged accidents.” On June 28, 2013, the owners of Febre’s Medical, Hernandez and Baceiro, entered into factual proffers with the State Attorney’s Office. The proffers acknowledged that they submitted fraudulent insurance claims and were the true owners of Febre’s Medical.

In order for Febre’s Medical’s bills to be compensable under the PIP statutes, Febre’s must substantially comply with all Florida Statutes. F. S. §627.732(11). Under F.S. §627.736(5)(b)(1), an insurer is not required to pay a claim “for any service or treatment that was not lawful at the time rendered.”

In this case, Plaintiff was issued a clinic exemption. In order to receive an AHCA clinic exemption, the facility must be “wholly owned” by one or more physicians. F.S. § 400.9905(f). It was established, however, pursuant to the proffer, that non-physician individuals, Hernandez and Baceiro, were the true owners of Febre’s Medical. Although all the licensing and corporate materials were in the name of either a physician or a chiropractor, Hernandez and Baceiro handled all aspects of the business and retained the bulk of the proceeds. Thus, they were deemed to be the true owners of the clinic. Because, therefore, Febre’s Medical was not “wholly owned by a physician,” as required by the PIP statute, its services were performed in violation of Florida statutes. For this reason, Defendant is not required to pay Febre’s Medical’s claims. F.S. §627.736(5)(b)(1).

Final judgment was entered in favor of Defendant MGA Insurance Company.

The case is Febre’s Medical Center vs. MGA Insurance Co., No. 09-10008 CC 26 (3) (Fla. Miami-Dade Cty. Ct. 2013).

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Filed under Case Law, Insurance Fraud

Three More Sentenced in Operation Sledgehammer

U.S. District Judge Kenneth A. Marra sentenced three more men involved in cases of staged car accidents to defraud insurance companies as part of Operation Sledgehammer, according to an article in the Sun Sentinel.

  • Luis Ivan Hernandez was handed down a sentence of nine years and ordered to pay $4.2 million in restitution. The 40-year old owned six clinics in Miami-Dade and Palm Beach counties, including one with girlfriend Maria Testa Baceiro. Testa was sentenced to six years, as reported in an October 4 post on FLPIPGuide.com.
  • Daviel Castro, authorities found, participated in the staged crashes, cashed checks and recruited others in the scheme. The 27-year old West Palm Beach man received a sentence of four years and 10 months in jail and will pay $1.3 million in restitution.
  • Aaron Freedlander, 51, a licensed chiropractor in Broward, was sentenced to three years and four months in prison. The Weston resident was ordered to pay a little more than $900,000.

According to federal prosecutors, each of the men had earlier pleaded guilty to conspiring to commit mail fraud. Hernandez and Castro also faced money laundering charges.

Court documents report that between approximately October 2006 and December 2012, those associated in the fraudulent scheme, including Castro, staged automobile accidents by recruiting individuals to take part. Then, clinic owners like Hernandez submitted false insurance claims through chiropractic clinics that were controlled by members of the conspiracy, authorities said.

Undercover agents christened the scheme ‘Operation Sledgehammer’ after they witnessed suspects using a sledgehammer to make vehicles appear like they had been in a car crash

So far, the operation has led to charges against 92 defendants in Broward, Palm Beach and Miami-Dade counties. Fifty-six have been charged federally and 36 by state prosecutors.

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Filed under Insurance Fraud

Operation Sledgehammer VI Catches Two More in Staged Car Accident Scheme

Operation Sledgehammer, a federal investigation named for the preferred ‘tool-of-choice’ that conspirators used in an automobile insurance fraud scheme involving staged car accidents and fake insurance claims, has prevailed again over two more defendants.

U.S. District Judge Kenneth A. Marra handed down sentences to Maykel Marquez, 32, of Jupiter, and Noelia Marichal, 52, of West Palm Beach, for their connection to the fraudulent scheme. Each had previously pled guilty to one count of conspiring to commit mail fraud; in addition, Marquez pled guilty to multiple counts of money laundering.

A steady stream of court cases has revealed that between roughly October 2006 and December 2012, accomplices in the scheme, often referred to as “Perro” and “Perra” or “Macho” and “Hembra” by the conspirators, were recruited to participate in fake car accidents and launder insurance money.

According to court documents, the extensive scheme was carried out by chiropractic clinics controlled by members of the conspiracy. They recruited individuals, with necessary medical or chiropractic licenses, who could open a clinic and act as “nominee owners.” Conspirators also hired chiropractors and therapists willing to prescribe and bill for treatments that were unnecessary or never provided to the ‘victims’ who were sent to these clinic after the staged accidents. Complicit employees then submitted false claims to the insurance companies for payment. Once insurance money was received, additional accomplices laundered the insurance money.

Sentencing documents show that Marquez cashed checks worth $568,517.23, while Marichal cashed $101,344.26 to launder insurance proceeds.

Starting with Operation Sledgehammer I in June 2011 and including Marquez and Marichal, accused in Operation Sledgehammer VI, 92 defendants have been charged thus far for their participation, according to a news release issued by the FBI and U.S. Attorney’s Office-Southern District of Florida.

Of those 92 defendants, 56 have been charged federally by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $5 million to the defrauded insurance companies. Thirty-six defendants have been charged by the Palm Beach County State Attorney’s Office alone. In all, 21 clinics participated in this scheme.

Marquez was sentenced to 58 months, followed by two years of supervised release. He was ordered to pay $1,177,775.04 in restitution. Marichal received a sentence of 48 months, followed by two years of supervised release and $1,359,208.73 in restitution, the news release reported.

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Filed under Insurance Fraud

Staged Car Crash + Bogus Car Accident = Fraud Charges for Deerfield Man

Suspicious circumstances surrounding car accident claims that were filed with multiple insurance companies for staged car crashes have led to the arrest of Jonathan Gualberto, 24, of Deerfield Beach, by Palm Beach County Sheriff’s Office deputies on Tuesday.

According to a report by the Florida Division of Insurance Fraud, detectives discovered more than $200,000 in insurance claims for car accidents that resulted in no injuries.  Gualberto, the architect behind the phony claims, now faces two fraud charges for bogus accidents in Boca Raton and Delray Beach.

The first accident occurred October 22, 2009, when Gualberto turned over the keys to his car to another man, who then hit a car transporting two of Gualberto’s acquaintances. An additional three people, including Gualberto, were in his car, detectives found.

No one reported any injuries when Boca Raton police responded; however, the six received medical treatment at two clinics, both of which had been linked to an organized staged-accident ring, according to investigators.

Fraudulent claims totaling $127,739 for medical treatment, bodily injury, property damage and attorney fees were then submitted to four insurance companies, according to the investigation report.

The second incident, which transpired a month later in Delray Beach, involved a woman who got her perhaps unsuspecting boyfriend, sister and another woman to travel with her, while a man in a car rented by Gualberto rear-ended them. Again, no injuries were reported, according to Delray Beach Police, but the group still filed four insurance claims for $78,191. Investigators say signatures on clinic billing forms appeared to have been forged.

According to a story in the Sun-Sentinel, it’s unclear whether other suspected participants in the fraud were arrested.

Gualberto’s driving record shows five speeding tickets with his latest for going 91 in a 45 mph zone in July 2012, according to the newspaper report.

Gualberto was booked into Palm Beach County Jail and released on $15,000 bail the next day.

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Filed under Fla. Stat. 627.736 (2008), Fla. Stat. 627.736 (2012), Insurance Fraud

Lee County Man Convicted in Staged Accident PIP Fraud

The first successful conviction in Lee County for a staged motor vehicle accident was recently announced by Florida Chief Financial Officer Jeff Atwater. Alain Guevara, 29, of Lehigh Acres, pleaded guilty in the 20th Judicial Circuit Court to staging an August 2012 motor vehicle accident and knowingly presenting false information in support of a PIP claim. He faces a two year mandatory minimum sentence.

The initial accident report stated that a rented truck, driven by Guevara’s accomplice, failed to obey a stop sign and collided with Guevara’s vehicle. Property damage ensued. Following the collision, Guevara knowingly presented a false, incomplete and misleading accident report to the insurance company. Allstate Insurance Company and REPWEST Insurance Company received the fraudulent PIP claims.

One of the insurance companies, suspecting fraud, reported the accident to the Department of Financial Services’ Division of Insurance Fraud (DIF). DIF commenced its investigation and concluded that the damage sustained by the vehicles was inconsistent with the accident account provided. In fact, a vehicle damage consistency report revealed that the car was not even in motion at the time of impact.

In addition to vehicular damage inspection and review of the facts, DIF subpoenaed phone records for the parties involved. Phone company logs revealed that the two drivers knew each other prior to the incident, as evidenced by numerous calls between them prior to, and immediately following, the collision.

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Filed under Fla. Stat. 627.736 (2012), Insurance Fraud

Nominate FLPIPGUIDE.com for the ABA Blawg 100

The ABA is giving blog readers a chance to vote for their favorite law blog as part of the ABA Blawg 100 annual selection process.

Known as “Blawg Amici,” these friend-of-the-blawg briefs are short testimonials from blog fans. The ABA staff encourages reader feedback as they compile their annual list of the 100 best legal blogs.

If you are a faithful reader of www.FLPIPGUIDE.com, this is your chance to give us a vote of confidence!

Click on the link below to vote. Responses are due no later than this Friday, August 9th.

After providing some identifying information, you will be asked for our “blawg” URL, which is: http://flpipguide.com/

You will also be asked to identify a specific 2013 blog post you like by using the page-specific URL. For example, some of our most popular posts this year include:

92 Accused in Staged Accident Fraud Ring, $20 million in Fraudulent Claims

Fort Myers Chiropractor Arrested, Caught Paying Confidential Informant to Fake Injuries

Space is provided for comments describing why you like reading the www.FLPIPGUIDE.com.

ACT NOW! The deadline is this Friday, August 9th. Click on the link to start:

We appreciate your support and readership.

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Filed under Fla. Stat. 627.736 (2008), Fla. Stat. 627.736 (2012), Introductions

92 Accused in Staged Accident Fraud Ring, $20 million in Fraudulent Claims


Operation Sledgehammer

According to investigators, charges were brought on Thursday against 33 people allegedly involved in fraudulent insurance claims totaling $20 million.  The Sun-Sentinel reported the following on the three year long investigation:

Operation Sledgehammer, a state and federal investigation, has led to charges being filed against a total of 92 defendants from Palm Beach, Broward and Miami-Dade counties. Those already convicted have been ordered to pay more than $5 million in restitution to insurance companies so far, prosecutors said.

The investigation revealed the ringleaders of the fraud recruited chiropractors Lazaro Rodriguez, 58, of Doral, and Kenneth Karow, 53, of to serve as owners of clinics involved in the ring.

Of the 92 people charged in the ring, five of the defendants, including alleged ringleaders Vladimir Lopez, 38, and Lazaro Vigoa Mauri, 45, have fled to Cuba.  According to authorities, the other defendants who have not yet been caught are considered fugitives.

Also from the Sun-Sentinel report:

[t]he investigation was kicked off by a tip from a member of the public and urged anyone with information to call their local police department.

The participants in the fraud were trained by recruiters on how to make the accidents look realistic, how to file police reports and insurance claims, how to fake injuries and where to go for treatment . . . The ringleaders made sure that insurance checks were deposited into accounts they controlled so they could pay the participants…

The full article from the Sun-Sentinel is available here.

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Filed under Fla. Stat. 627.736 (2008), Insurance Fraud