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The Florida Department of Financial Services’ Division of Insurance Fraud (DIF) announced the arrest of Darley Caridad Carballeira, 50, for her involvement in a scam in which she overbilled a local company, Key International, Inc. more than $167,000 during the sale of at least nine insurance policies. On top of inflating the policy amounts to gain a profit, Carballeira allegedly financed the insurance policies, which enabled her to pocket the upfront premium amount, leaving Key International on the hook for additional monthly payments to keep the policies current.
The investigation revealed that for more than three years, Carballeira overbilled Key International Inc. by inflating quoted prices for insurance policies. For example, if the quoted price for a policy was $46,000, she charged the company $67,000. She did this on at least three occasions, and her greed escalated each time. Carballeira overbilled the company $3,100 on the first bill, overbilled $11,000 on the second, and nearly $21,000 on the third billing.
After the fictitious insurance premiums were paid by Key International in full, in an attempt to further her illegally-obtained financial gain, Carballeira decided to finance the original policy amounts without Key International’s knowledge. Signatures were forged to finalize the financing documents and mailing addresses were altered to prevent Key International from receiving any notices on the recent financing of their insurance premiums. In total, Darley Carballeira stole more than $167,000.
The case began when Key International, Inc. became suspicious and approached the Department’s Division of Agent and Agency Services' Bureau of Investigation with a series of information regarding their allegations against Carballeira. The Bureau of Investigation launched a partnered investigation with the Division of Insurance Fraud into the day-to-day operations of the Miami insurance agency where Carballeira worked, Insurance Consultants of Dade, Inc.
Carballeira was apprehended on charges including first degree grand theft, misappropriated funds, and uttering forged documents. This case will be prosecuted by the office of Miami-Dade County State Attorney Katherine Fernandez Rundle, and if convicted, Carballeira faces up to 30 years in prison.
Chief Financial Officer Jeff Atwater knows that Florida’s homeowners carry insurance to protect their property in the event of an emergency, natural or otherwise. Floridians have seen the costly destruction hurricanes can cause as well the financial volatility that storms can create in the property insurance market. Each year, the Office of Insurance Regulation tests the financial soundness of property insurance companies that conduct business in the state of Florida to ensure they can withstand the catastrophic losses generally associated with major storms. However, in an effort to bolster consumer confidence levels, CFO Atwater asked Florida Insurance Commissioner Kevin McCarty to strengthen the financial ‘stress tests’ these companies are put through and to share the results with Florida’s policyholders.
“Companies large and small go through annual financial tests to make sure they are well-managed and able to deliver and remain viable when the next hurricane hits Florida’s shores, but the results have not been made public in a way that’s meaningful to the consumer,” said CFO Atwater. “Consumers deserve to have confidence in their carrier, and we’ll continue to share information that shows the processes that are undertaken to test their financial strength. I appreciate Commissioner McCarty’s efforts to create a more robust test as well as his efforts to share the information with policyholders and the industry. I look forward to continue working together to create an even better test next year.”
The stress test involves examining each of the participating property insurance company’s ability to respond to the impact of historical storm scenarios. In order to pass the test, companies must a carry post-event surplus greater than a minimum set in Florida law. Arriving at the required post-event surplus is a combination of an insurance company’s existing surplus as well as the reinsurance program the company has in place to protect that surplus amount.
This year, three historical storm scenarios were used: the 1947 Fort Lauderdale hurricane, the 1921 Tampa Bay hurricane, and the four hurricanes of 2004, Hurricanes Charley, Frances, Ivan and Jeanne. During the 2015 season, each of the 67 participating companies ultimately passed the test.
To view the full report, visit OIR’s website here. For consumer assistance regarding insurance-related matters to include this report, call the Department’s Insurance Helpline at 1-877-693-5236.
The Florida Department of Financial Services’ Division of Insurance Fraud (DIF) announced nine arrests following a multi-agency workers’ compensation sting in Manatee County. These nine individuals were found to have advertised their ability to perform jobs such as plumbing, electrical, and air conditioning work without proper licenses or training, and without having workers’ compensation coverage to protect their employees in the event of an accident or injury.
Those who were arrested include:
• Margaret Espinal,
• Ruben Hernandez-Caleron,
• Juergen Hinz,
• Martin Joseph Aldridge,
• Mario Marcello Botton,
• Michael Robert Hawkins,
• Victor Honeycutt,
• Stephen Clay Dennis
• Ian A. Oswald
During the three-day operation that ended September 25th, DIF detectives accompanied by logistical and tactical support from multiple agencies, established an undercover sting across the Tampa-Bradenton area in an effort to stop this illegal practice. Detectives responded to the aforementioned public advertisements, calling for contractors to perform services at a specified location in Manatee County.
The investigation revealed that of the nine individuals arrested, unlicensed and uninsured plumbing and electrical services were allegedly offered by Ruben Caleron, Juergen Hinz, Michael Hawkins, Victor Honeycutt, Stephen Dennis, and Ian Oswald. Illegal contracting services limited to plumbing only were allegedly offered by Margaret Espinal and Martin Aldridge and services regarding plumbing and AC repair were allegedly offered by Mario Botton.
When individuals knowingly neglect the law, they create a liability risk for property owners by performing sub-par work and by potentially leaving property owners responsible to cover medical costs if an uncovered worker is hurt on their property.
Multiple agencies played a vital role in securing the sting’s successful outcome. These agencies include: the Manatee County Sheriff’s Office, the Bradenton Police Department, the Palmetto Police Department, the Longboat Key Police Department, the Bureau of Workers’ Compensation Compliance, the City of Bradenton Code Enforcement, the Department of Business and Professional Regulation, Manatee County Code Enforcement, and the Manatee County State Attorney’s Office.
The nine individuals who were arrested were booked into Manatee County Jail on charges of workers’ compensation fraud and unlicensed contracting, and if convicted, they can face up to five years in prison. These cases will be prosecuted by the Office of Manatee County State Attorney Ed Brodsky.
Chief Financial Officer Jeff Atwater announced the arrest of Broward County Chiropractor Eric Wiegandt, 41, on multiple felony fraud charges related to a $1.5 million insurance fraud scheme. A joint state and federal investigation led by the Florida Division of Insurance Fraud revealed that Wiegandt allegedly orchestrated a scheme in which he fraudulently billed Blue Cross Blue Shield for services that were never rendered at his clinic, the Broward Spine and Rehab Center, located in Hollywood.
Investigators believe that between 2013 and early 2015, Eric Wiegandt fraudulently signed and submitted nearly $1.5 million worth of fictitious and falsely represented insurance claims. In return, Wiegandt received commission payments from BCBS in excess of $230,000.
In the early spring of 2014, following months of mismanagement and after losing his license for failure to complete continuing education requirements, Wiegandt was evicted from his practice location in Coral Gables and opened a new location in Hollywood. The Hollywood Police Department became aware of Wiegandt’s now unlicensed practice and arrested him for continuing to conduct insurance-related business without an active license.
Shortly after, the Hollywood Police Department brought in the Division of Insurance Fraud to review the insurance transactions related to the clinic’s day-to-day operations. As a result, investigators discovered that Blue Cross Blue Shield had flagged Eric Wiegandt during a proactive data analysis after recognizing that his practice produced exceptionally high totals in number of visits per patient and total amounts billed.
Records show that patients who previously visited Wiegandt’s Coral Gables location were allegedly receiving duplicative treatments in his newest Hollywood location, all of which were being billed to BCBS. After multiple interviews were conducted with the alleged patients, most were found to have never received treatments and many had never been to the Hollywood location.
Wiegandt was arrested on eight counts of healthcare fraud and the case is being prosecuted by the US Attorney’s Office of the Southern District of Florida. Multiple agencies contributed to the successful conclusion of this case including: Blue Cross Blue Shield of Florida, The Hollywood Police Department, as well as the Inspector General for the Federal Office of Personnel Management and the U.S. Postal Service.
The Florida Division of Insurance Fraud, which operates under the direction of Chief Financial Officer Jeff Atwater and the Department of Financial Services, announced the arrest of Naples man Daniel T. Phelps, 56, for allegedly stealing two insurance claim payments totaling more than $96,000 from an elderly New Jersey business owner. George Capuzzi filed the initial insurance claim after damage was sustained to his business during Hurricane Sandy in 2012.
In 2014, the Division of Insurance Fraud received information indicating that Daniel Phelps stole two checks from George Capuzzi, an insured business owner, who was awaiting an insurance payout to make the necessary repairs needed to re-open his business located in Atlantic City, New Jersey.
DIF’s investigation revealed that in 2013, George Capuzzi was suffering from health-related issues and needed assistance with the processing of filing the post-hurricane insurance claims for his business. In light of Capuzzi’s need for aid, a mutual friend referred Daniel Phelps as someone who could assist with the claims filing process.
Taking advantage of the elderly business owner, Phelps re-directed the delivery of the insurance claims checks to his girlfriend’s residence in Naples. Once the checks were mailed, Phelps took a trip to South Florida, where he endorsed the checks by forging Capuzzi’s name. In an attempt to mask the fraudulent deposit, Phelps utilized his unsuspecting step-brother’s driver’s license to deposit the checks into a joint bank account. Phelps then transferred the money out of the joint account and into a personal account, where he used the money at will.
Over a course of three months, in addition to numerous cash withdrawals, Daniel Phelps spent George Capuzzi’s $96,000 on a new Jaguar car, a boat, Lasik eye surgery, and a trip to Key West. To date, George Capuzzi’s business has never re-opened and Capuzzi is yet to have been made whole as a result of this theft.
Daniel T Phelps was picked up at the Broward County Health Center on charges of scheming to defraud, grand theft, and criminal use of personal ID. This case is being prosecuted by the Office of the State Attorney, 20th Judicial Circuit of Florida under State Attorney Stephen B. Russell.
The Department of Financial Services’ Division of Insurance Fraud (DIF) announced the arrest of John Alexander Fraga (aka Juan Alejandro Fraga) for his involvement in the billing of more than $40,000 to multiple insurance companies for the treatment of fake injuries following a series of staged car accidents in an attempt to fraudulently collect personal injury protection (PIP) insurance payments for profit.
Dating back to May 2011, DIF has investigated a series of staged car accidents that occurred in the Jacksonville area. During a five month period in 2012, DIF investigated three separate staged accidents that involved fraudulent rehabilitative practices at Jacksonville’s Gate Parkway Diagnostics Center (GPDC).
DIF investigators discovered that the occupants of the vehicles involved in the staged accidents were allegedly recruited by GDPC employees to seek treatment for fake injuries following each accident. John Fraga, a licensed massage therapist at GDPC, authorized 127 documents that were used to bill multiple insurance companies for PIP insurance payouts totaling more than $40,000. The forms signed were for services that never occurred as treatment for injuries that failed to exist.
During the course of this ongoing investigation, several other arrests tied to this operation have been made, including: Sandy Morales, the owner of GDPC, and the four individuals who were occupying the vehicles involved in these staged accidents; Michael Huerta, Olegario Hernandez Perez, Danay Torres-Gomez, and Salvador Torres.
John Fraga was arrested and booked into the Miami-Dade County Jail. He faces five felony charges, and if convicted, he faces up to 35 years in prison. This case will be prosecuted by ASA Joe Licandro in the Office of State Attorney Angela B. Corey.
The Florida Office of Insurance Regulation (Office) has approved the removal of up to 140,000 personal residential policies and 2,500 commercial residential polices from Citizens Property Insurance Corporation (Citizens) by the following four companies:
· Anchor Property & Casualty Insurance Company – approved to remove up to 20,000 personal residential policies (15,951 Personal Lines Account and 4,049 Coastal Account)
· Heritage Property & Casualty Insurance Company – approved to remove up to 55,000 personal residential policies (39,800 Personal Lines Account and 15,200 Coastal Account) and up to 1,500 commercial residential policies (1,300 Commercial Lines Account and 200 Coastal Account)
· Olympus Insurance Company – approved to remove up to 10,000 personal residential policies (7,917 Personal Lines Account and 2,083 Coastal Account)
· United Property & Casualty Insurance Company – approved to remove up to 55,000 personal residential policies (19,800 Personal Lines Account and 35,200 Coastal Account) and up to 1,000 commercial residential policies (940 Commercial Lines Account and 60 Coastal Account)
Citizen’s Personal Lines and Commercial Lines Accounts are mostly non-coastal properties and the Coastal Account is coastal properties. The take-out periods are December 22, 2015 for personal residential impacting both the Personal Lines/Coastal Account policies and December 15, 2015 for commercial residential impacting both the Commercial Lines/Coastal Account policies. This is part of the state’s ongoing depopulation effort to reduce the number of policies in the state-created Citizens and transfer them to the private insurance market.
This announcement brings the total number of policies approved for take-outs in 2015 to 1,321,193. By statute, policyholders may choose to remain covered by Citizens during take-out offers. To date, 141,647 policies have been removed from Citizens this year.
For more information, visit the Office’s “Take-Out Companies” webpage at: http://www.floir.com/Sections/PandC/TakeoutCompanies.aspx.
Florida Insurance Commissioner, Kevin M. McCarty, asked Craig Fugate, Administrator of the Federal Emergency Management Agency (FEMA), to work collaboratively with the Florida Office of Insurance Regulation (Office) by providing specific information related to the National Flood Insurance Program’s (NFIP) rates. The letter to FEMA includes a supplemental document entitled the “NFIP Rate Support Data Request”, which outlines the basic rate-making data the Office is requesting by December 15, 2015.
The information requested will also enable the Office to address the concerns raised by Senator Brandes in the letter sent to the Commissioner on August 12, 2015.
For more information, see below:
We highly recommend that licensees routinely check their MyProfile account(s) for messages from the Department. We send an email notification when a message has been sent to remind you to check your MyProfile account but on rare occasions you may not receive that email. For that reason, we suggest you add our domains dfs.state.fl.us and MyFloridaCFO.com to your email software's Trusted or Safe Senders List to ensure you are able to receive email notifications from us. Licensees who have a valid email address on file with the Department, as required by law, are sent important email notifications when something that affects their application, license, continuing education, or appointment(s) occurs. Additionally, we will keep you informed with warnings regarding new schemes and scams being marketed to licensees. You can update your contact information through your MyProfile account. We want to keep you informed in a timely manner of pertinent information. You are still required to abide by the Florida Insurance Code regardless of whether you read the information we provide or attempt to provide.