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CFO Sink Announces Arrests of 7 South Floridians on Charges of PIP Fraud

5/8/2009

 
FOR IMMEDIATE RELEASE: May 8, 2009                                     
CONTACT:  Kyra Jennings or Jennifer Hirst
                  (850) 413-2842     
 
CFO SINK ANNOUNCES ARRESTS OF 7 SOUTH FLORIDIANS ON CHARGES OF
 PERSONAL INJURY PROTECTION (PIP) FRAUD
 
MIAMI -- Florida Chief Financial Officer Alex Sink today announced the arrests of seven individuals involved in a Personal Injury Protection (PIP) scam in the Miami area.  The under cover investigation began approximately six months ago when the Department of Financial Services’ Division of Insurance Fraud was contacted by an anonymous source familiar to law enforcement.  With assistance from the National Insurance Crime Bureau (NICB) and North Miami Police Department, the Division of Insurance Fraud conducted the arrests without incident and more arrests are pending.
 
“Arrests like these send a strong message that PIP scams will not be tolerated in Florida,” said CFO Sink. “Fraud doesn’t just hurt insurance companies – it inflicts real financial pain on families, businesses and communities.  I commend our dedicated Division of Insurance Fraud for their work to uncover and stop this scheme.”
 
Joel Lopez, 37, Claudia Valdes, 20, Jose Valiente, 71, Gladys Ochoa, 49 and Jeanette Coira, 29, all worked at the E & B Rehabilitation Center in Miami.  Lopez, the owner of the rehab center, actively took part in the fraud scam where individuals would stage an automobile accident, call the police, and have an accident report written. 
 
In this case, Roberto Fonseca, 23 and Elisa Ortega, 44, created the damage to the cars in one area, and then drove to an intersection to “crash” the cars.  An officer from the North Miami Police Department was called to the scene and wrote up the accident report.
 
The next day, the individuals came to the E & B Rehabilitation Center to turn in their accident report.  E & B Rehab submitted three fraudulent insurance claims totaling over $60,000 to Progressive and Metropolitan Life Insurance Company, who cooperated in this investigation.  State Farm Insurance, who was not billed in this case, also assisted.  Lopez then paid Fonseca and Ortega to use the services at his clinic for the fraudulent medical treatments.  His employees, who include, Valdes, Valiente, Ochoa, and Coira all participated in creating fraudulent medical and therapy paperwork for the participants to sign in order to submit to insurance companies for reimbursements.
 
DFS Captain Steve Smith was very pleased with the investigation’s outcome.  “We have been working undercover for six months on this case and it is a good feeling to know it resulted in multiple arrests,” said Captain Smith.
 
The Department of Financial Services’ Division of Insurance Fraud, a sworn law enforcement agency, made over 800 insurance fraud-related arrests in the last fiscal year.  The Department of Insurance Fraud investigates various forms of fraud in insurance, including health, life, auto, property and workers’ compensation insurance. 
 
Depending on the estimated loss amount, the department will pay up to $25,000 for information directly leading to an arrest and conviction.  Anyone with information about this or any other suspected insurance fraud is asked to call the department's Fraud Fighters Hotline at 1-800-378-0445 or log on to www.MyFloridaCFO.com/fraud.