October 2011
Volume 2 - Issue 4
“The working group’s
goal is to formulate a
well-documented report
that can be used by both
Legislators and others to
formulate good policy
direction for this matter.”
INSIDE THIS ISSUE
1
2
PIP Working Group
4
PIP Fraud Spotlight
on a Fraud Case
5
6
7
8
Licensing Updates
PIP Fraud in the
News
Fraud Alert Team
Statewide Arrests
Statewide Contacts
HEADER HERE
Insurance Consumer
Advocate’s PIP
Working Group Meets in Tallahassee
Florida’s Motor Vehicle No-Fault Law, which requires registered owners and drivers to
maintain Personal Injury Protection (PIP) coverage, is intended to hold down medical
expenses for minor injuries sustained in a motor vehicle crash without regard to fault. It is
also intended to curb litigation costs for minor injuries and non-economic damages. In
recent years fraud has so permeated this coverage that the initial value of such a system
is, at best, diluted and now threatens to be prohibitively expensive for Floridians.
Florida Insurance Consumer Advocate Robin Westcott has assembled a working group
to develop a policy paper that will formalize the discussion regarding Personal Injury
Protection reform. The working group’s goal is to formulate a well-documented report
that can be used by both legislators and others to formulate good policy direction for this
matter.
Westcott presided over the first two meetings of the PIP Working Group held on
September 15 and 26 in the House Office Building in Tallahassee. The group includes
representatives of the Florida Hospital Association, the Florida Osteopathic Medical
Association, the Florida Chiropractic Association, the Florida Medical Association, the
Florida Bar, the Florida Justice Association, the Florida Insurance Council, the Property
Casualty Insurers Association of America, the Florida Public Information Research
Group (PIRG), the Insurance Information Institute, the Coalition Against Insurance
Fraud, the Division of Insurance Fraud, the Florida Senate Banking and Insurance
Committee, the Office of the Governor, the Office of Insurance Regulation and insurance
carriers Allstate, Blue Cross and Blue Shield of Florida, State Farm, and United
Automobile. It is also being monitored by the House of Representatives.
Presentations have been made by Ron Poindexter, Regional Director of Florida for the
National Insurance Crime Bureau (NICB); Sandra Starnes, Deputy Director at the Office
of Insurance Regulation (OIR); Captain Steven Smith from the Division of Insurance
Fraud (DIF); Roger Bell, Manager of the Health Care Clinic Unit for the Agency for
Health Care Administration (AHCA); and Christopher Brown, Legal Counsel for the
Hillsborough County Sheriff’s Office (HCSO).
Topics of discussion included PIP fraud and abuse, PIP fraud statutes, the licensing and
exemption of healthcare clinics, a newly passed ordinance involving PIP clinics in
Hillsborough County, the cost borne by healthcare insurance after PIP benefits are
exhausted, billing and payment processes, and alternative dispute resolution.
The working group met on October 10 for the final time. Westcott anticipates that the
working group’s report will be completed by November 2011. All of the materials and
more information is available at the Insurance Consumer Advocate’s website at http://
www.myfloridacfo.com/ICA/PIPWorkingGroup.htm.
The PIP Source
Page 2
PIP FRAUD – In The News
DIF Director John Askins Retires
The Division of Insurance Fraud has lost a friend...again. John Askins, who served for 20 months as the Director of the
Division, retired on September 2. Askins started his 33-year career with DIF in 1978 as an investigator, two years after it
was created by the Florida Legislature to combat ambulance chasers. He enjoyed a brief retirement in 2008 for about 17
months before he was drafted to return and take over as Director of the agency in January 2010. Askins loved the
Division, and his commitment and dedication to the work of the Division of Insurance Fraud in protecting the citizens of
Florida against fraud was evident in every conversation with him. He spent his first 24 years with DIF in the Miami office,
before packing up and moving to Tallahassee. Askins served under seven directors and five insurance commissioners /
chief financial officers during his tenure. Askins was well respected by his agency and the industry for both his
knowledge and his integrity. Thank you for your service to the Division, and to the citizens of the State of Florida.
Jack Kelley is serving as Interim-Director.
CFO Atwater Attends Staged Accident Demonstration in Miami
Florida CFO Jeff Atwater attended a demonstration put on by Allstate Insurance and the Miami-Dade Police Department
in September. The purpose of the demonstration was to educate the public about staged accidents and to encourage
them to report such activity to law enforcement. Atwater told the South Florida Sun-Sentinel that staged accidents are a
big reason that Personal Injury Protection insurance premiums are rising despite a decline in reported accidents.
CFO Atwater urged citizens to call the fraud hotline (800-378-0445) to report suspicious activity: “So please, if anyone
could bring it to our attention about one of these scams that are taking place, let us get engaged, let us get them in front
of prosecutors, let us put them in jail where they belong.” If a referral leads to an arrest and conviction, callers could be
eligible for a reward of up to $25,000.
The Legislature is already gearing up to address PIP fraud in the 2012 session. CFO Atwater and Governor Rick Scott
have called on their colleagues to fix PIP.
Hillsborough County Commission Passes PIP Ordinance to Combat Clinic Fraud
The Hillsborough County Commission unanimously passed an ordinance designed to combat the rise in staged
accidents and PIP fraud in their area. The ordinance, spearheaded by Commissioner Kevin Beckner and the
Hillsborough County Sheriff’s Office, passed 7-0. It will require the licensing of any medical clinic that provides treatment
or therapy to patients claiming injury due to an auto accident. (See page 6 for related photos and information.)
“This ordinance will give our Sheriff’s Office the tools it needs to put an end to the auto insurance fraud that has plagued
our community,” Commissioner Beckner said. “Our actions today will put a stop to rising car insurance rates due to the
proliferation of staged accidents and act as a model for statewide policy. I applaud my fellow commissioners for making
this issue a priority. We are sending a unified message that fraudulent behavior will not be tolerated in our community.”
The passage of this ordinance is the culmination of more than a year’s worth of work by Commissioner Beckner and
other stakeholders, including the National Insurance Crime Bureau. According to the NICB, Hillsborough County is
ranked number one in the state in auto insurance fraud, and ranked second in the country behind New York City.
NICB and State Farm Provide Fraud Training to Jacksonville Sheriff’s Office
In August, NICB SSA Wayne Pollaci conducted a training session
with the Jacksonville Sheriff’s Office Community Service Officers on
NICB overview and staged accidents.
In addition Bill Watson, State Farm SIU, instructed them on how to
identify vehicle damage at a crash scene.
A total of 16 officers were trained.
Thanks to Wayne Pollaci and Bill Watson for their hard work.
October 2011
Page 3
PIP FRAUD – In The News
Florida Bar Holds Hearing on Lawyer Referral Services in Orlando
The Florida Bar’s Special Committee on Lawyer Referral Services held another all-day hearing in Orlando last month,
listening to testimony from persons involved with referral services, including a lawyer for 411-PAIN, a former employee of
1-800-ASK-GARY’s clinics, and an attorney involved in litigation with a referral service. Also heard was video testimony
from former clients who were satisfied with the services provided, and former clients who were not.
The committee also listened to a panel discussion involving relevant bar rules, and another panel discussion with health
care professionals and a state representative. The Department of Financial Services also presented information
regarding fraudulent schemes and possible illegal activity associated with referral services.
NICB, Farmers Insurance and HCSO Conduct PIP Fraud Training
FOX 13 News in Tampa ran a story last month on the staged accident problem in the areas surrounding Hillsborough
County. Hernando County Sheriff Al Nienhuis wants to make sure the staged accident problem that hit that county never
makes it north, stating "Just like any crime, the better it's investigated in one area, criminals move to an area where the
training is not quite as good." Hernando deputies received some training in a presentation about trends, patterns, and
indicators of staged accidents that was provided by Farmer’s Insurance, the Hillsborough County Sheriff’s Office and the
National Insurance Crime Bureau (NICB). Nienhuis said it's a problem Hernando drivers can’t afford. "Studies show this
is costing upwards of a billion dollars a year in Florida,
which equates the average person with two cars per
house hold at least $100 a year," he said.
According to Anthony Speranza of the NICB, people are
taking unfair advantage of Florida's Personal Injury
Protection, or PIP coverage. "We're all victims of this
crime, and our insurance premiums - your health, auto and
property insurance. So it's a very lucrative business,"
Speranza said.
Julianna Hyde of Farmers Insurance SIU participated in
the training and added, “We wanted to continue to provide
training to the surrounding areas as we have already seen
the fraud move outside of Hillsborough County. We expect the recently passed PIP ordinance to further this trend.”
According to the Fox 13 News Story, Sheriff Nienhuis said there is one suspected staged crash now under investigation
in Spring Hill. Check out the full story - http://www.myfoxtampabay.com/dpp/news/local/nature_coast/floridas-billion-dollar-problem09122011.
Hialeah PD Checks for Fake Insurance Cards
Sixteen insurance companies collaborated with the Hialeah Police Department last month in an operation to check fake
insurance cards in that city. All traffic stops on that day were also going to have their insurance coverage checked in an
attempt to locate and arrest violators. Among the personnel who participated were:
Raymond Curbelo, Sumitra Singal, Rick Smith, Mike Stein and Dallas Taylor of Allstate; James Reid of Direct; Mandy
Alvarez of Esurance; Christian Lemus of Gainsco; Eddie Hernandez of GEICO; Jack Tucker of GMAC; Erick Orta of
Infinity; Brett Kelley and Robert Marcelo of Kingsway Amigo; Jacqueline Hill, Maria Fuentes, Nora Santana and Yolanda
Velazquez of Mercury; Nancy Jensen of
MetLife; Denise Gembala and Matt
Armentano of Nationwide; Steve Moccia of
Sentry; Julio Castillo and Christopher
Munoz of Star Casualty; Kevin Cox of State
Farm; Nancy Lopez of Travelers; and
Wendy Sassman of United Auto.
Also participating from NICB were Fred
Burkhardt, Tony Fernandez, Ralph Garcia
and Yaneth Santiago.
The PIP Source
Page 4
PIP FRAUD SPOTLIGHT ON – A Case of a
Chiropractor, Fraud and an Accident Clinic
In September 2006, the Hialeah Police Insurance Fraud Unit concluded a five-month undercover investigation involving
staged accidents, patient brokering and billing for services not rendered. It ended with the execution of a search warrant
at an accident clinic called Armi Rehab Center, which had operated for nearly four years in Hialeah. They arrested five
subjects, including the clinic’s owner and a chiropractor. Sounds like the typical accident clinic scam, right?
The focus of our story is the chiropractor. He was the top licensee working at the clinic, and his involvement was critical
to the fraud that took place within the walls of the business. Although he did not own the clinic, the chiropractor obtained
an exemption from the Agency for Health Care Administration (AHCA), which concealed the identity of the true owner.
In fact, the true owner of the clinic was a convicted criminal, previously arrested by the Division of Insurance Fraud (DIF)
for solicitation in 2001, whose record may have prevented the clinic from being licensed. When the chiropractor used his
license to obtain the false exemption, he facilitated everything else that happened within the walls of that clinic.
The office manager at Armi Rehab was arrested along with two participants in a staged accident. The clinic owner was
charged with insurance fraud, grand theft, communications fraud and patient brokering and the chiropractor was charged
with insurance fraud, grand theft, communications fraud, organized fraud and making a false statement on a clinic
license application.
Over the next year, the case worked its way through the criminal justice system. The two accident participants were
sentenced to 18 months and two years in prison, respectively. The office manager entered a plea and was sentenced to
one year community control and three years probation. The clinic owner was sentenced to three years in prison followed
by one year community control and one year probation. In June 2007, the chiropractor entered a plea of nolo
contendere (no contest) with the Court and was sentenced to five years probation.
Since he was a licensed chiropractor, the Florida Department of Health opened a case and issued an administrative
complaint in 2008 relating to his arrest and conviction. The complaint against the chiropractor is very strongly worded,
and contains clear-cut and deliberate statements about his activity and responsibilities as a licensee. Included among
the statements in the lengthy complaint: “the crime for which Respondent pled nolo contendere is a crime that directly
relates to the practice of chiropractic medicine or the ability to practice chiropractic medicine; that as the licensed
physician who signed the claims forms for three different patients had a duty to ensure that all the care billed for was
actually provided, and that the treatment provided was appropriate and medically necessary; and that he failed to take
adequate steps to ensure that the care provided to three different patients was actually rendered or medically
necessary.” The complaint concluded that the chiropractor had violated rules by failing to record adequate examinations
and histories for patients; failing to record or maintain legible treatment records that indicated who provided the treatment
to patients; failing to record or maintain legible treatment records that adequately described patient subjective or
objective symptoms; failing to record or maintain legible treatment records that adequately described the treatment
provided to patients; or failing to record or maintain treatment records that justified the treatment provided to patients.
In July 2010, the chiropractor asked and the Court granted early termination of his probation. The chiropractor wanted to
work in a healthcare facility but, because of his conviction, he needed the Board of Chiropractic Medicine to grant an
exemption. With the complaint still pending against him, the chiropractor appeared before the Chiropractic Board in April
2011, with counsel, and asked for an exemption. The chiropractor addressed the board and stated he was working full
time with Dade Injury Rehabilitation since 11/08. He also provided his prior work experience with other clinics, which
included New Life Chiropractic from 12/08/06 to 10/08/08; Versailles Chiropractic Center from 08/07/06 to 10/03/06 and
Armi Rehab Center in 2004 (until his arrest). The board granted his request for exemption with a vote of 7-0.
When the chiropractor next appeared before the Chiropractic Board in June 2011, he had signed a settlement
agreement which included: a reprimand; a $10,000 fine; investigative costs of $19,794.93; restricted from working in a
health care clinic licensed under Part X of Chapter 400, F.S.; two years of supervised, monitored probation; and 13
hours of continuing education courses, which included 2 hours in ethics and boundaries. At the June hearing, the Board
voted to stay the fine, the investigative costs and the monitoring language until the chiropractor notified the Board that he
is working as a chiropractor.
PIP fraud cannot succeed without a licensee in the mix. Other than the initial ride to jail when arrested, the chiropractor
spent no time behind bars, and he never lost his license. If the acts in this case do not deserve severe penalties, what
signal does that send to the licensees who commit insurance fraud? What can all of us do to change that?
If you want to read the complaint and final order in this case, check this link at the Department of Health website: http://
ww2.doh.state.fl.us/DocServiceMngr/GetImage.aspx?documentid=MTQyODc4MzY=&enc=1
October 2011
Page 5
Licensing Updates
From time to time, we will try to provide information regarding the licensing status of persons who have been arrested for
PIP fraud related charges. Here is our first installment.
The following persons have surrendered their license with the Department of Health, either through a plea agreement
with the State Attorney’s office or with the Department of Health’s regulatory Board having jurisdiction.
Maria Del Carmen Valencia, 59 - Massage Therapist (Medico de la Familia)
Dustie L Graham, 26 - Massage Therapist (West Waters Medical Center)
Courtney S Braden, 21 - Massage Therapist (Superior Injury Care Clinic)
Yanurys Tait Libera, 30 - Massage Therapist (New Horizon Practice)
Ernesto B Cal, 52 - Massage Therapist (New Horizon Practice)
Kingsway Amigo Donates Vehicle to Hialeah PD to Fight Fraud
Last month, Kingsway Amigo renewed its vehicle agreement
with the National Insurance Crime Bureau (NICB) and the
Hialeah Police Department to assist in the fight against
fraud. Our thanks to Kingsway Amigo and SIU Manager
Brett Kelly for their assistance in this matter.
L to R: Fred Burkhart, SSA NICB; Ronald Duke, Sgt Hialeah
Auto theft; Oscar Oliveros, Hialeah Auto Theft Detective;
Luis Sanchez, Hialeah Auto Theft Detective; Roberto
Marcelo, Kingsway/Amigo SIU; Tony Fernandez, SSA NICB;
Brett Kelly, Kingsway Amigo SIU Manager.
How You Can Help Fight Insurance Fraud in Florida
This year, the Florida Legislature created a fund to which anyone can contribute to the fight against insurance fraud by
making a donation, gift or grant to the Insurance Regulatory Trust Fund. The proceeds will be used by the Division of
Insurance Fraud to hire additional dedicated prosecutors, insurance fraud detectives, and fund anti-fraud programs
around the state. This is an exciting program that we believe will have a substantial impact on insurance fraud in Florida.
Payments should be made payable to: The Department of Financial Services
The mailing address is:
Department of Financial Services
Revenue Processing Section
P.O. Box 6100
Tallahassee FL, 32314-6100
The donor should include correspondence with the check indicating this is a grant or donation for the Division of
Insurance Fraud. The letter should include his / her intent that the grant or donation be deposited to the Insurance
Regulatory Trust Fund and used for anti-fraud efforts. Also include a statement that if the donation is to be used for any
other purpose, the funding should be withdrawn.
If you have any questions, you can contact us at the PIP Source and we will get an answer. Thank you for your help.
Join the Fight. Be a part of the Solution. Make a Difference.
The PIP Source
Page 6
Thanks to The Fraud Alert Team
Formed in December 2009 to fight the rising fraud in the Tampa Bay area, the Fraud Alert Team has been committed to
the effort in many ways. Last month, their efforts succeeded in a big way, when the Hillsborough County Commission
passed an ordinance that regulates PIP clinics. On this page, you will see a flyer from the Fraud Alert Team about their
hard work on the issue, and photos showing their support in turning out on the day of the vote in Tampa.
We thank the Fraud Alert Team for their continuing good work, with a special thanks to Jose Cruz, who has led the team’s
efforts as President over the last two years. Visit their website at http://thefraudalertteam.com.
The Fraud Alert Team was featured in the October 2010 issue of the PIP Source. The Fraud Alert Team proved that you
can make a difference. We encourage persons to join together and form
their own fraud alert team or group. If you are active in the fight against
fraud, let us know so we can share your experience.
October 2011
Page 7
Statewide PIP Arrests – September 2011
Each issue will provide a list of PIP arrests made by the offices throughout the State. Along with each defendant’s name
and age, we will include: the type of scheme involved; the fraud dollar amount; clinic name(s); victim insurance company
name(s); and the arresting office. If you need additional details on any of these arrests, please contact Captain Smith.
Juan Susana, 32 – staged acct 10/03/09 (driver) $10,000 - A&C Medical (Republic West) F
Emile Paul, 67 – staged acct 01/18/10 (passenger) $8,000 - Kam Habibi, DC (Infinity) B
Reina Vasquez, 35 – application fraud / claim loss - $15,923 (Travelers) M
Taviary Williams, 35 – application fraud / fraudulent claim - $3,287 (Esurance) B
Javier Moreno, 37 – staged acct 05/25/10 (recruiter) $29,069 – Family Health Care Solution / Health & Wellness Services (Allstate / State Farm) M
Suzanne Kennedy, 50 – patient brokering – Mendez Rehab Center / Medical Rehabilitation I / Physical Rehab Center
(Nationwide) T
Valentina Ortiz, 36 – patient brokering – Mendez Rehab Center / Medical Rehabilitation I / Physical Rehab Center
(Nationwide) T
Allan Howard Till, 58 – false claim - $100,000 (MetLife) W
Edilberto Paz-Amaya, 32 – patient brokering – Mendez Rehab Center / Medical Rehabilitation I / Physical Rehab Center (Nationwide) T
Jose Miguel Alvarado, Jr, 28 – patient brokering – Mendez Rehab Center / Medical Rehabilitation I / Physical Rehab
Center (Nationwide) T
Deveth Noralus, 38 – staged acct 01/18/10 (passenger) $12,140 - Kam Habibi, DC (Seminole Casualty) B
Remy Zamor, 35 – patient brokering / solicitation - (Nationwide) O
Jessica Ortiz, 28 – false statement in support of jump-in 09/23/08 – $19,660 - Primary Care Medical Center (Allstate) M
Joaquin Ross Vazquez, 28 – structuring - $856,541 New York Medical & Rehab Center / Karow Chiropractic Center,
PA Chiropractic Office of South FL, LLC / J & L Transportation () W
Oscar Franco Padron, 45 - structuring - $856,541 New York Medical & Rehab Center / Karow Chiropractic Center, PA
Chiropractic Office of South FL, LLC / J & L Transportation () W
Lucy Caba Rodriguez, 43 – staged acct 05/31/07 (passenger) $8,760 – Cordova Medical (Gainsco) M
Leonardo Santos, 37 – staged acct 02/19/10 (recruiter) $41,304 – Sunshine Therapy and Medical Center
(Responsive / US Security) W
Iris Roca, 39 – clinic employee - $4,280 – Universal Rehab Medical Group (Allstate) W
Alian Luis Valdes, 23 – staged acct 12/27/10 (driver) $10,769 - New Life Clinic Service (Geico) M
Office Code –B (Broward) F (Ft Myers) J (Jacksonville) M (Miami) O (Orlando) TL (Tallahassee) T (Tampa/St Pete) W (West Palm Beach)
The PIP Source
Page 8
Statewide PIP Contacts
PANHANDLE REGION
Counties: Bay, Calhoun, Escambia, Franklin, Gadsden, Gulf,
Holmes, Jackson, Jefferson, Lafayette, Leon, Liberty,
Madison, Okaloosa, Santa Rosa, Taylor, Wakulla, Walton,
Washington
Pensacola Field Office - 850.453.7802
Captain Buddy HAND
Lt. Joseph HOLOKAN
NORTH REGION
Counties: Alachua, Baker, Bradford, Citrus, Clay, Columbia,
Dixie, Duval, Flagler, Gilchrist, Hamilton, Levy, Marion,
Nassau, Putnam, St. Johns, Sumter, Suwannee, Union
Jacksonville Field Office - 904.798.5802
Captain Brian McCOY
Lt. Kevin JONES
WEST CENTRAL REGION
Counties: Charlotte, Collier, DeSoto, Glades, Hardee, Hendry,
Hernando, Highlands, Hillsborough, Lee, Manatee, Pasco,
Pinellas, Polk, Sarasota
Tampa Field Office - 813.972.8602
Captain Michael BYRNE
Lt. Carlos ROSARIO
Lt. Darrell WILSON
Fort Myers Field Office - 239.278.7527
Lt. Mark FRITZ
Copy goes her.
Editor’s
Corner
This month we present a report on the Insurance
Consumer Advocate’s Personal Injury Protection
(PIP) Working Group as it meets to discuss ways to
address the PIP fraud crisis in Florida.
We say goodbye to Director John Askins, who
retires after a 33 year career of fighting insurance
fraud. We will miss him.
We spotlight the case of a chiropractor as he
moves his way through the system after
committing fraud. You may be surprised at the
final outcome.
And we keep you updated on all the recent PIP
related news that we feel you need to know. Please
share this publication with your family and friends.
EAST CENTRAL REGION
Counties: Brevard, Indian River, Lake, Martin, Okeechobee,
Orange, Osceola, Palm Beach, Seminole, St. Lucie, Volusia
West Palm Beach Field Office - 561.837.5601
Major Simon BLANK
Captain Glen HUGHES
Lt. Evangelina BROOKS
Orlando Field Office - 407.835.4402
Lt. Jewel CAMERON
SOUTH REGION
Counties: Broward, Dade, Monroe
Miami Field Office - 305.536.0302
Captain Steven SMITH
Lt. Violeta SERRANO
Lt. John DYGON
Lt. Stanley JEAN-FELIX
Plantation Field Office - 954.321.2902
Lt. Bill LEE
South Florida Major Medical Fraud Task Force
Supervisory Special Agent Fred Burkhardt 954.329.7427
Central Florida Major Medical Fraud Task Force
Supervisory Special Agent Dennis Russo 863.967.6904