Insurance License Fraud Case.

In Ohio, Federal law does not contain a single general definition matching that quotation; 18 U.S.C. § 1033 instead criminalizes specified knowing and intentional false statements and related conduct by persons engaged in the insurance business whose activities affect interstate commerce. This broad definition allow federal authorities to target a wide range of insurance-related offenses. Rather than focusing solely on a policyholder’s attempts to defraud their insurer, this approach enables authorities to target insurance fraud on both sides of the industry. This includes everything from the falsification of an insurance policy application to the diversion of premiums by an insurance agent. In Georgia, some of the statutory materials that we’ve reviewed define what they call “insurance fraud.” According to Georgia Code § 33-1-9, a natural person commits insurance fraud if the person knowingly or willfully makes or aids in making specified false or fraudulent statements, receives money for purchasing insurance and converts it to the person’s own benefit, issues fake or counterfeit insurance policies or related documents, or makes specified false representations concerning a policyholder’s death or disability.

How Does a Suspected Insurance-License Fraud Matter Move from Inquiry to Charge?

Insurance investigations can originate from the insurance industry itself, state agencies, federal authorities, or law enforcement. Depending on the specific allegations at hand, these investigators could be insurance company personnel, state insurance investigators, or federal agents. These investigators can use a variety of means to gather information, and they will use whatever means they have the legal authority to use. They can request your records, interview witnesses, or issue subpoenas; or, they can quietly review claims, policies, and other documents. What evidence do investigators look for in insurance-license fraud cases? Just as with other types of insurance-license fraud, the specific types of evidence that insurance-license fraud investigators look for are case-specific. This can include everything from claim forms, photographs, estimates, and medical records to insurance applications. Investigators also tend to search for additional evidence such as text messages, emails, recorded statements, bank records, and other financial documents. Insurance-license fraud investigations can lead to all kinds of consequences. An insurer investigation is not a regulatory proceeding; a regulatory proceeding is not a grand-jury proceeding; and a grand-jury proceeding is not a criminal charge. None of these are equivalent to a guilty verdict in a court of law, either. All of these are different types of legal (and nonlegal) processes. It is imperative that our clients understand the difference. We are able to guide our clients through each phase, and we can help you decide the best way to protect your license, your career, and your future.

When Can a License Violation Become a Criminal Case in Ohio or Georgia?

In Ohio, the federal government’s fraud laws are very broad. The statutory pages we reviewed that pertain to federal insurance-fraud prosecutions all have “knowingly,” “intentionally,” or “with intent to defraud” or similar language within them. It appears that, in order to prosecute insurance-fraud cases, federal authorities must be able to demonstrate that there was a form of knowingly intentional deception involved in the underlying circumstances. Similarly, several pages we reviewed that discussed the federal government’s ability to prosecute these cases distinguish between “fraud” and mistakes, misunderstandings, and differing opinions about values in dispute claim scenarios. Because of the broad nature of the federal government’s insurance-fraud statutes, federal prosecutors often identify an additional, related offense that justifies a federal prosecution in these cases. Examples of these related offenses include mail fraud and racketeering. Determining whether insurance-license fraud constitutes a felony requires identifying the governing offense and the governing jurisdiction. If the government files a federal case, then federal law governs the issue. This may involve identifying the specific statute at issue, its requirements, and the penalties it provides for those who violate it. In Georgia, for example, the relevant insurance-fraud provisions are within Title 33, the state’s insurance code. Within Title 33, there are multiple sections which address fraud. Some of these provisions refer to violations that are specifically identified as felonies; others refer to violations that can be tried civilly or are considered violations only of Georgia’s licensing rules (or are a mix of all three).

Which Ohio Loss Amounts Change the Insurance-Fraud Offense and Prison Exposure?

When faced with federal insurance fraud charges in Ohio, the amount of money at issue plays an extremely important role in determining both the nature of the charges and the resulting sentencing exposure. In many cases, insurance fraud in Ohio is categorized as a felony, and the specific degree of the felony offense depends upon the amount of losses, whether these losses are real or attempted, and other factors. The Ohio Revised Code (R.C.) provides thresholds for these calculations, and these thresholds can drastically affect a defendant’s potential sentencing exposure in the event of a conviction. In some cases, a defendant’s sentencing exposure under one felony offense is similar to that of a different offense.

For example, in Ohio, insurance fraud charges involving amounts below $1,000 can result in a first-degree misdemeanor insurance-fraud offense. A first-degree misdemeanor insurance-fraud offense in Ohio carries a potential sentence of up to 180 days. In contrast, insurance fraud charges involving amounts from $1,000 through $7,500 can constitute a fifth-degree felony insurance-fraud offense. A fifth-degree felony insurance-fraud offense in Ohio also carries up to twelve months’ imprisonment.

The difference between these two offenses, however, is significant in that the latter is a felony offense rather than a misdemeanor offense. Further up the scale of loss amount ranges, insurance fraud charges involving amounts from $7,500 through $150,000 can constitute a fourth-degree felony offense. As loss amount increases, the classification of the insurance-fraud offense continues to shift upward accordingly. While these thresholds are important in their own right, defendants and their defense counsel must be prepared to dispute not only the classification of the offense and its penalties, but also the amount of the false or deceptive claim. This is because disputing the loss amount can be an effective way to challenge the government’s case against the defendant in many circumstances.

What Can a Georgia Insurance-Fraud Allegation Cost Besides Imprisonment?

Georgia’s insurance-fraud penalty range is very wide. In some cases, it is listed as being two to ten years’ imprisonment and fines reaching up to $10,000. This is just one example; the classification of the offense is critical, and the penalty associated with the offense will depend upon the governing law’s classification. However, the specific nature of the offense in a case, and the specific location, is just as important. Regardless of where a case takes place, criminal penalties alone are only one type of penalty. These are separate from civil consequences. In a criminal case, this means that even if there are no criminal penalties, there can still be civil fines, restitution, and business-license revocation. These are all very real consequences that can change the outcome of a case, and they can have extremely severe impacts on your life.

In some cases, these are listed as fines, restitution, and business-license revocation. This is a common issue in insurance fraud cases, as the state licensing authority typically has the ability to revoke an insurance company’s or professional’s license upon finding that the licensee engaged in fraud.

A defendant’s past criminal history can also trigger penalty enhancements that change the ordinary sentencing range of the offense involved. These enhancements are subject to challenge as well, and a defendant’s defense counsel should examine the government’s calculations if the underlying conduct has any relationship to insurance fraud.

Speak With a Federal Defense Lawyer

If you are dealing with any part of what this article describes, the next step is a conversation with a lawyer who handles these cases. Spodek Law Group is a second generation criminal defense firm practicing since 1976, representing clients nationwide from offices in New York, Brooklyn, Queens and Los Angeles. Call 888 348 8028 to speak with our team.