"Fewer scams, lower rates: End state's reputation as the national center of auto insurance fraud"

You don't find Florida's consumer advocates and Florida's insurance companies holding hands very often, but they have become best buddies in the fight to end the state's reputation as the national center of auto insurance fraud.

According to the insurance industry, Tampa, Miami and Orlando are three of four leading cities for fraud, after New York. The industry further estimates that auto insurance fraud in Florida is a $1 billion business that adds roughly $100 to the premium of a family with two cars. Even if the industry's figures aren't precise, Florida Consumer Action Network Director Bill Newton has it right when he says, "If we can control fraud, everybody benefits."

Florida is vulnerable to such fraud because of the state's no-fault auto insurance law, passed nearly four decades ago. The goal was admirable: to settle claims from minor crashes out of court. Scammers, though, game the system by staging accidents, recruiting "victims" who get phony treatment at bogus clinics. Auto fraud is not a new issue for the Legislature, but the recent surge in no-fault claims - an estimated 46 percent increase between 2008 and 2010 - prompted creation of the Sunshine Alliance to Erase Fraud

A comprehensive anti-fraud bill is being drafted, with the sponsors to be Sen. Ellen Bogdanoff, R-Fort Lauderdale, and Rep. Jim Boyd, R-Bradenton. The main provisions will include a requirement that police take names of all passengers in a crash - to determine who was truly injured - a warning on applications for clinics' licenses that fraud is a crime, and the ability of insurers to interview, under oath, all claimants from a crash . The bill should not be confused with House Bill 967, which aims to reduce attorneys' fees in no-fault cases.

Prosecutors also can play a role. When Miami-Dade County State Attorney Katherine Fernandez-Rundle assigned one prosecutor strictly to auto fraud, industry analysts believe, scam operations shifted to Tampa. The goal, though, is not just to keep scammers on the run but to put them out of business. Florida is also home to plenty of Medicare and Medicaid scams, but the state needs to work with the federal government in cracking those rings. With auto fraud, Florida is in the driver's seat.

For more information please visit: http://www.palmbeachpost.com/opinion/editorials/fewer-scams-lower-rates-end-states-reputation-as-1296217.html?cxtype=rss_editorials

"Auto insurance fraud crackdown in Miami-Dade"

When the owner of a West Miami-Dade medical clinic schemed to bill insurance companies for staged auto accidents, she did not know that an undercover witness was secretly recording her, authorities say.

“Bring me good stuff,” Elsa Terrero, of New Horizon Practice, told a cooperating witness, according to an arrest warrant released Wednesday. “I control all the clinics in this building … you will get paid.”

Terrero was one of 25 people — including three doctors — charged Wednesday in a crackdown on “personal injury protection” fraud in Miami-Dade that officials say costs insurances companies millions of dollars each year, and ultimately raises rates for consumers. Terrero’s scam cost insurance companies nearly $800,000, though the amount is likely much more, officials said.

“This is not a clinic. This is a fraud mill,” Florida’s Chief Financial Officer Jeff Atwater said at a press conference Wednesday.

“Many people see the insurance fraud as a victimless crime. It is not,” said Miami-Dade State Attorney Katherine Fernandez Rundle.

The ring was cracked by detectives from the state’s Department of Financial Services fraud division, and Miami-Dade prosecutors. PIP insurance pays for up to $10,000 in medical bills and lost wages, and Florida ranks as one of the top states in the country for staged auto accident fraud.

Terrero, 40, is charged with racketeering, grand theft, organized scheme to defraud and a slew of other felonies. The others face similar charges.

The undercover investigation began in November 2009 when a man named Martin Triana, secretly working with detectives, agreed to stage an auto accident at a red light in Liberty City, according to an arrest warrant.

Triana later went to the clinic, 7171 Coral Way, where he signed 25 blank therapy forms, which would later be submitted to insurance companies, and was later X-rayed by an unlicensed technician. Later visits resulted in no treatment, the warrant said.

The clinic later billed State Farm insurance for 40 therapy sessions. The clinic also billed the company for three visits with Dr. Gerald Amado, who never examined Triana; the doctor was arrested Wednesday.

Triana later recruited a man named Miguel Hernandez, who was actually an undercover detective using a fake identity. Hernandez played along in another bogus accident, the warrant said, and the result was that clinic billed Imperial Fire & Casualty Insurance Company for $20,225.24.

For more information please visit: http://www.miamiherald.com/2011/03/02/2094346/auto-insurance-fraud-crackdown.html