Seattle woman pleads guilty to insurance fraud

Woman pleads guilty to insurance fraud in fender-bender case

By VANESSA HO

SEATTLEPI.COM STAFF

An Issaquah woman pleaded guilty to three insurance fraud charges, after she got into a minor car accident, claimed major back pain, sued the other driver and used fake medical records to scam more than $300,000 from two insurance companies, state officials said Friday.

In November of 2004, Linda Ann Rose was driving in a Sammamish parking lot when an SUV backed into her car at “a very low speed,” the state Office of the Insurance Commissioner said in court records.

Rose then visited several doctors complaining of back pain and eventually had back surgery. The other driver, Margaret Jobe, had insurance through three carriers, and Rose demanded money from all three, prosecutors said.

Rose gave the insurers her previous medical records, which showed many references to knee problems, but none to any pre-existing back pain, court records show. MetLife, Jobe’s car insurer, paid out $60,000.

Rose also sued Jobe and her husband. The lawsuit settled for $800,000, releasing Jobe from liability and paving the way for Rose to go after two more insurers, Progressive and RLI.

Progressive paid $250,000 of the settlement. But when Rose tried to squeeze the remaining $550,000 from RLI, the company got suspicious and dug up Rose’s true medical records. It discovered that Rose had repeatedly replaced the word “back” with “knee” in the records, and that she had suffered from back pain since 2000, according to court documents.

On top of scamming the insurance companies, Rose created a financial hardship for her victim. In court records, Jobe described how the case had caused her and her husband to drain their kids’ college funds to pay nearly $15,000 in legal fees. She said the judgment against them, which has been vacated, had affected their credit score.

 

“We feel tricked and victimized and outraged,” Jobe said in a court declaration.

Rose – who entered a modified guilty plea last week to three counts of “false claims or proof” – is scheduled to be sentenced Nov. 16 in King County Superior Court.

Rich Roesler, a spokesman for the Insurance Commissioner, said insurance fraud hurts all consumers.

“A big fraud case like this can have a trickle-down effect on all premium payers,” he said. “That’s why fraud enforcement matters.”

 

Vanessa Ho can be reached at 206-448-8003 or vanessaho@seattlepi.com. Follow Vanessa on Twitter at twitter.com/vanessaho.

Seattle Insurance Fraud

Insurance Fraud Seattle WA

Content Provided By J.D. Power and Associates

Non-profit sites like the Coalition Against Insurance Fraud (CAIF) report that auto insurance fraud costs a staggering $12.3 billion or more a year. The worst part is that this cost is passed along to consumers, most of whom would never consider committing insurance fraud themselves. Instead, they find themselves paying up to hundreds more annually on their premiums. Money paid by insurance companies for fraudulent insurance claims add to the companies’ annual loss, a statistic that is always used to establish future rates. And in the auto insurance industry, fraud is one of the major cost components increasing the price of insurance for consumers.

Auto insurance fraud often involves staged accident rings and the filing of one or more fraudulent accident claims. This can include staged accidents in which the drivers of two or more vehicles intentionally collide, or accidents caused by con artists (involving you in a wreck that is made to look like your fault). Auto insurance fraud can also be performed by auto repair shops or mechanics that bill for unperformed work or parts. Or by individuals who do get in a wreck and claim the loss of more property than was actually in the car, charge for repairs and/or damage that was not due to the current accident, or report fraudulent injury claims of passengers. There also exists in the industry what is known as a “paper claim,” which involves an accident that never actually happened and only exists on paper.

Insurance Fraud

By Rob Moritz
Arkansas News Bureau

LITTLE ROCK — The recent arrests of nine people in an alleged counterfeit insurance card ring is the latest wave in a rising tide of insurance fraud.

The head of the Arkansas Insurance Department’s Criminal Investigation Division blames the worst economic downturn in decades for a surge in wide-ranging cases his agency has been asked to investigate.

Nationally, officials say insurance fraud costs the average household close to $1,000 a year.

“We investigate all kinds of insurance fraud, any where from insurance agents pocketing premium money to staging car crashes to prepaid funeral home policies being pocketed,” said Greg Sink, director of the Arkansas Insurance Department’s criminal investigation division. “There are all kinds of ways to scam the system.”

In the past five years, Sink’s team of 12, including six investigators and three lawyers, has seen the number fraud cases it investigates skyrocket, from 356 cases in all of 2005 to 536 referrals during the first eight months of this year.

“It really has increased every year,” Sink said. “Yes, I would say the economy has a lot to do with the increase.”

According to the Coalition Against Insurance Fraud, the struggling national economy has caused many anxious consumers and businesses to turn to insurance fraud schemes to try and bail themselves out of financial distress.

Insurance fraud is the second most common crime in the U.S. behind burglary/theft, the coalition says.

“People are anxious, their finances are in trouble and regrettably they are turning to insurance fraud as a way to shore up their financial difficulties,” said Jim Quiggle, communications director for the Washington, D.C.-based group.

A 2009 survey by the coalition of insurance fraud bureaus across the country found that the number of cases referred and investigated rose in every category of fraud.

The largest average increases were in bogus health plans, prescription fraud and fraud of insurance agents.

In Arkansas, Sink said all forms of fraud are up but one that his division is seeing an increasingly high number of is counterfeit insurance cards.

Last month, nine people, two of them employees of the Arkansas Department of Human Services, were arrested on charges of producing, buying or selling counterfeit proof of motor vehicle insurance.

Officials allege the DHS employees used their work-related DHS computers to generate fake insurance cards. The cards were allegedly sold for $50 each.
The state employees were fired as a result of the investigation.

“We’ve seen a rash of these fraudulent insurance cards recently,” Sink said. “People think that since they have a computer, they can create them and we’re getting a lot of those cases now.

“They’re selling them to other people, or just creating them for themselves and going up to (the Department of Finance and Administration) and getting their (car) tags renewed.”

In Arkansas, the issuance or possession of a counterfeit insurance identification card is a felony, punishable by up to six years in prison and a maximum fine of $10,000 for each count.

The department’s criminal investigation division was created by the Legislature in 1993 to investigate worker’s compensation fraud cases. The division started with a half-dozen employees, two of them investigators.

The division’s role was expanded in 1995 to include investigating all kinds of insurance fraud.