FEDERAL CRIMINAL LAWYERS

NY Penal Law § 176.15: Insurance Fraud in the Fourth Degree

Insurance fraud is a white collar crime that occurs when someone provides false information to an insurance company in order to receive a payment from the insurance company that they would otherwise not have received. While it is often associated with medical insurance, it can involve any type of insurance arrangement such as life insurance, automobile insurance, property insurance, workers’ compensation, commercial insurance, and publicly funded insurance arrangements such as Medicare or Medicaid. Under the New York criminal code you would have committed a fraudulent insurance act if with intent to defraud you provide an insurance company with false information or you hide information from the insurance company. Examples of insurance fraud include burning property to collect insurance money, falsely claiming that a car was stolen in order to collect the insurance money, claiming that property was damaged in an accident or stolen during a robbery when it was not, or overstating the value of stolen or damaged property.

There are several different insurance fraud offenses in the New York criminal code. If you commit a fraudulent insurance act the specific insurance fraud crime you will face will depend on several different factors, such as the type of insurance plan involved and the amount of money involved. Under New York Penal Code § 176.15, you will face a charge of insurance fraud in the fourth degree if you carry out an insurance fraud act and thereby obtain or attempt to obtain property with a value of more than $1000 but less than $3000.

Two Examples

Cynthia injured her back while on her job in the warehouse where she works. Because of the injury, she filed a workers’ compensation claim. In the claim, she gave a statement that she was not working anywhere else.  In reality, Cynthia was also working part time at a friend’s restaurant. In this scenario, Cynthia could be charged with insurance fraud, since she lied about a material fact that would impact the amount of benefits she would receive.  

In the case of the People v. Grant, 61 AD3d 177 (N.Y. App. Div., 2009), Dr. Terry Grant, a licensed dentist, was charged with insurance fraud in the fourth degree on the basis of submitting falsified claims forms to numerous insurance companies over a span of 6 years. 

Offenses that are Related

Life settlement fraud in the fourth degree: New York Penal Law § 176.50

Health care fraud in the fourth degree: New York Penal Law § 177.10

Insurance fraud in the fifth degree: New York Penal Law § 176.10

Insurance fraud in the third degree: New York Penal Law § 176.20

Insurance fraud in the second degree: New York Penal Law § 176.25

Insurance fraud in the first degree: New York Penal Law § 176.30

Possible Defenses

To have undeniably committed insurance fraud, you would have had to have made an untrue statement about a material fact on an application or a claim form. If you lied about a minor issue that would not have any effect on whether or not the insurance payout would have been authorized under the plan, or on the amount of the payout, then an insurance fraud charge against you would not be valid.

In addition, you could not be prosecuted on an insurance fraud charge if you did not have intentions of defrauding the insurer. For example, if you put in a claim for property loss from a burglary, but you did not realize that the specific item was removed by a family member before the burglary took place, then you would not have committed an insurance fraud crime. Likewise, if the claim is connected to vehicle damage in an accident, and you mistakenly include damage that really occurred in a previous incident, then here again, you would not have committed insurance fraud.

The Sentence

Insurance fraud in the fourth degree is categorized as a class E felony offense.  If you are convicted, the judge could send you to jail for up to 4 years and you could be required to pay a fine. Additionally, the judge could sentence you to serve a probation term of 5 years. On top of that, the judge may order you to pay restitution to the victim.