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Gallagher Commends Governor’s Signing of Bills to Fight Methamphetamine, Insurance Fraud


Tami Torres or Nina Banister
(850) 413-2842
TALLAHASSEE—Tom Gallagher, Florida's chief financial officer, hailed legislation that Governor Jeb Bush signed today as a tremendous step toward making Florida's communities safer from methamphetamine and meth labs and also reining in auto insurance fraud.  Gallagher, who oversees two law enforcement agencies involved in these issues, pursued the legislation and said legislators are to be commended for taking these bold but necessary steps.
"Methamphetamine devastates families and communities, and this legislation will significantly bolster our ability to protect Floridians from this evil drug," Gallagher said.  "The anti-fraud legislation will allow us to continue an aggressive crackdown on auto fraud that already has led to increased arrests and jail time and reductions in premiums in the last three years.  This legislation is a big win for the people of Florida."
House Bill 1325, sponsored by Rep. Faye Culp and Sen. Carey Baker, authorizes the immediate removal of children found in methamphetamine labs, allows courts to withhold bond for meth manufacturers, and extends greater protections to emergency responders injured while responding to meth labs.  House Bill 561, sponsored by Rep. David Rivera and Sen. J.D. Alexander, tightens the grip on fraud artists who steal from Florida's hard-working families by staging or fabricating auto crashes and making fraudulent auto insurance claims. 
The State Fire Marshal's Office has responded to more than 50 meth lab fires and explosions in the last two years.  And, in conjunction with the Multi-Jurisdictional Counter Drug Task Force, the State Fire Marshal's Office has helped educate and prepare hundreds of Florida emergency responders to respond to the dangers these labs pose.  More than 1,000 responders in 16 states, including Florida, have been injured responding to meth labs in the past five years, and nearly half of all children found in meth labs test positive for having the drug in their blood.
In addition to authorizing the Department of Children and Families to begin dependency proceedings for the immediate removal of children found at meth labs and allowing courts to hold meth producers without bail while awaiting trial, House Bill 1325 enhances criminal penalties when firefighters or other emergency response personnel are injured or killed while responding to meth labs (third-degree felony if injured; second-degree felony if killed or severely injured) and prevents them from having life or health insurance canceled if they test positive for meth as a result of performing their jobs. 
"The number of meth labs found in Florida has increased by 1,100 percent in five years,, and that means more children, first responders and communities are at risk," Sen. Baker said.  "We must do all we can to fight back against this insidious drug."
Rep. Culp said the legislation builds on successful strategies already put in place by Gov. Bush and the Governor's Office of Drug Control.  "For those who still have not gotten the message that we don't want meth in our state, they will know we mean business when they are left to sit behind bars."
Senate Bill 1596 enhances penalties for the newest twists on auto insurance fraud – "phantom" and "paper" auto accidents that never actually occur – making either a second-degree felony punishable by a two-year minimum mandatory prison sentence. 
Florida law requires drivers to carry a minimum of $10,000 in Personal Injury Protection (or PIP) coverage and $10,000 in property-damage liability coverage.  Many auto insurance fraud cases involve unscrupulous lawyers, doctors and clinic owners who illegally bill for services covered by PIP, which provides coverage for medical bills from an auto accident, regardless of who is at fault. 
Auto insurance fraud has been estimated to cost the average Florida family as much as $250 a year, but tough legislation passed in 2001 and 2003 in tandem with increased arrests and prosecutions have led to lower premiums in recent years.
"Fraud has driven up insurance rates for far too long. This legislation sends the message that fraud will no longer be tolerated," said Sen. Alexander. "Those who participate in auto insurance fraud will pay for their crimes."
Rep. Rivera said the legislation also will help fight insurance fraud by providing for a forfeiture fund to help finance ongoing investigations into PIP fraud.
 "The work being done by the Division of Insurance Fraud and law enforcement agencies around the state to combat insurance fraud is commendable," Rep. Rivera said.  "As a result of aggressive investigations and prosecutions, auto insurance premiums are decreasing and that's good news for Florida's families."
This corresponds with a 2003 law that established a two-year minimum sentence for anyone organizing or participating in an actual staged auto crash.  The legislation also:
• Provides for revocation of the driver's license of anyone convicted of auto insurance fraud.

• Makes it a third-degree felony for any service provider, such as a clinic or body shop, to waive insurance deductibles as a general business practice.  Waiving deductibles makes it easier for individuals to profit from insurance fraud schemes.

• Requires medical clinics to post the state's Fraud Fighters hotline and reward program information.  

• Clarifies that kickbacks for patient referrals are illegal whether the patient is being referred to or from a medical clinic, and provides that patients themselves may be punished for soliciting kickbacks for their cooperation in fraudulent billing schemes against the insurer. 
Gallagher has overseen the department's Division of Insurance Fraud for the past five years, during which time the department has made more than 3,200 insurance fraud arrests including more than 1,000 PIP fraud arrests.  The division has consistently led the nation's insurance fraud bureaus in arrests and convictions.  The new legislation becomes effective on July 1, 2006.