Fraud Files: Multi-Million Dollar Health Care Fraud

In this edition of Fraud Files we focus on a multi-million dollar scam in south Florida. Seven defendants including owners, doctors, a manager, and a laboratory representative of sober homes and alcohol and drug addiction treatment centers were charged for their participation in a health care fraud and money laundering scheme that involved the filing of fraudulent insurance claim forms and defrauded health care benefit programs.

Mississippi Legislature Tackles Cargo Theft

The Mississippi legislature is considering two bills that would create a specific offense for cargo theft. House Bill 722, introduced by Representative Steve Massengill (R-District 13), and Senate Bill 2184, introduced by Senator Dennis DeBar, Jr. (R-District 43), recognize the impact that cargo theft has across the entire socio-economic spectrum. The proposed legislation creates law specific to cargo theft from a railcar, commercial trailer, semitrailer, fifth wheel or container and includes substantial penalties upon conviction.

Cargo theft is a major national crime problem which adds to the cost of merchandise, food and transportation. Stolen food and pharmaceuticals pose a real health hazard and these commodities, along with electronics, continue to be the favorite target among cargo thieves.

Just consider the health implications for innocent consumers who, believing that they are getting safe and secure products, unknowingly buy stolen food or drugs which have been improperly stored or exposed to contaminants as they moved through the illicit commerce stream. Individuals who feed their greed through potentially deadly acts of cargo theft deserve the special attention that these two bills provide.

To help educate the public, NICB produced a public service announcement describing the impact of cargo theft and it has been airing on radio and television stations across the nation. It is available here.

NICB urges the Mississippi legislature to pass HB 722 and SB 2184 to provide law enforcement and prosecutors with the legislation necessary to address the public health threat posed by cargo theft.

Know Before You Tow!

As we’ve written in the past tow trucks scams are becoming a major issue across the country. The National Insurance Crime Bureau (NICB) is warning and educating consumers about unethical and illegal practices among some rogue towing and storage operators and repair shops around the nation.

In our latest episode of Fraud Files we take a look at how states are cracking down on illegal towing fees.

Here’s a list of the most recent legislative activity involving towing laws across the country:

California – Assembly Bill 1222, Signed Into Law – September 2015

* Prohibits a towing company from stopping at an accident scene unless summoned to the scene by the owner of the vehicle, owner/operator, or requested by law enforcement
* Establishing requirements to provide proof that a tow truck driver was summoned to the scene
* Require towing companies to provide a written estimate of all charges to the vehicle operator and a signature by the vehicle operator before proceeding with the tow and maintaining a cap on the amount of the tow
* Require towing companies to maintain a record of all towing documents for a period of 3 years and to make those records available for inspection by law enforcement
* Misdemeanor penalties

Illinois – Senate Bill 2261, Signed into Law – August 2016

* Penalties on towers who illegally solicit accident victims – Class 4 Felony
* Towers who violate the accident scene solicitation law can be sued by the vehicle owner and/or the owner’s insurer.
* Also created a statewide relocation towing commission tasked with examining the towing laws of the state and to make recommendations

Missouri – House Bill 1976 – Law Effective November 2016

* Prohibits a towing company from stopping at an accident scene unless summoned to the scene by the owner of the vehicle, owner/operator, or requested by law enforcement, unless it’s an emergency situation
* Allow vehicle owners access to storage yard and sets requirements for when storage yards to be open
* Requires towers to make available upon request a written estimate of all tow-related charges
* Requires a tow rotation list be maintained and utilized by the Missouri State Police, but local jurisdictions are not mandated to use that list
* Misdemeanor penalties for 1st offense, felony on 2nd

Ohio – House Bill 341, Signed into Law – January 2017

* Allows a civil action by insurers against a towing company operator to recover a vehicle. The vehicle is released within 2 days of the insurance company paying the “undisputed amount” of the bill from the towing company.

Pennsylvania

* NICB is working with a state lawmaker from the Pittsburgh area on legislation in 2017 to address towing abuses in Pennsylvania. The problem is most prominent in Philadelphia and Pittsburgh.

Anyone with information concerning tow scams can report it anonymously by calling toll-free 1-800-TEL-NICB (1-800-835-6422), texting keyword “fraud” to TIP411 (847411) or by visiting our web site at www.nicb.org.

Warming Up That Vehicle May Lead to a Ticket

keysincarnicbAs frigid temperatures and wintry blasts have hit a large section of the nation, drivers are increasingly “puffing” – warming up their parked vehicles before heading out on the road. The National Insurance Crime Bureau (NICB) warns that leaving an unlocked car running with the keys or fob inside can lead to two unwanted scenarios.

First, it makes your vehicle a prime target for an opportunistic car thief. In fact, one of out every eight vehicles stolen in 2015 had the keys or fob left inside. That can cost you a few hundred dollars to thousands of dollars depending on your level of theft insurance.

Second, in an effort to reduce unnecessary thefts, many states and municipalities have passed laws banning “puffing.” It’s illegal to leave the car running and unlocked, even in your driveway. Remote starters that allow you to start the engine while the car is safely locked up without the keys are usually considered a safe alternative.

“Getting a warning or a ticket is preferable to having your car stolen,” said NICB President and CEO Joe Wehrle. “As we’ve reported previously, 57,000 vehicles were stolen in one year with the keys left inside. That’s one every six-and-a-half minutes. And when you add up the costs of replacing those vehicles, it’s hundreds of millions of dollars. Many of those cars are not insured against theft and the owner is left holding the bag and paying for a new car.”

NICB recently produced new public service announcements related to this issue and they are now airing on media outlets around the country. Here are the links to view them: Leaving Your Keys in Your Vehicle and Warming Up Your Car.

To view a list of states where it is illegal to leave a vehicle unattended while running click here.

Stolen 1964 Corvette Stingray Returned After 40 Years

In this edition of Fraud Files we have the story of a 1964 Chevrolet Corvette Stingray that was stolen in 1976 and recovered some 40 years later. With the help of a California Highway Patrol officer and a little bit of research from the NICB the original owner was reunited with her prized vehicle after four decades.

To view more editions of Fraud Files click here.

This “Mystery Device” Can Unlock and Start Your Vehicle

The National Insurance Crime Bureau (NICB) says new technology is being used to not only unlock and open vehicles, but to also start and steal them.

NICB recently obtained one of the so-called “mystery devices” that the public was first warned about over two years ago. At the time, thieves were being seen on security cameras across the country, using unknown devices to unlock vehicles and steal valuables inside. In recent months, NICB has noted reports of thieves not only opening the vehicles but also starting them and driving away.

The device obtained by NICB was purchased via a third-party security expert from an overseas company. It was developed by engineers in an effort to provide manufacturers and other anti-theft organizations the ability to test the vulnerability of various vehicles systems. Called a “Relay Attack” unit, this particular model only works on cars and trucks that use a keyless remote and a push-button ignition.

mysterydeviceinfographic-photoversion-final-113016-webIn a series of unscientific tests at different locations over a two-week period, 35 different makes and models of cars, SUVs, minivans and a pickup truck were tested. We partnered with NICB member company CarMax, because they are the nation’s largest used car retailer and have nearly every make and model in their inventory. Tests were also done at a new car dealership, an independent used car dealer, at an auto auction and on NICB employee vehicles and ones owned by private individuals.

The vehicles were tested to see if the device could:
* open the door
* start the vehicle
* drive it away
* turn off and restart the engine without the original fob present

deviceinaction

NICB was able to open 54% of the vehicles that were tested.

The NICB was able to open 19 (54 percent) of the vehicles and start and drive away 18 (51 percent) of them. Of the 18 that were started, after driving them away and turning off the ignition, the device was used to restart 12 (34 percent) of the vehicles.

NICB says there are a number of different devices believed to be offered for sale to thieves. Some use different technology and may work on different make and models and ignition systems. More expensive models may have a greater range and better capabilities for opening and starting a vehicle.

“We’ve now seen for ourselves that these devices work,” said NICB President and CEO Joe Wehrle. “Maybe they don’t work on all makes and models, but certainly on enough that car thieves can target and steal them with relative ease. And the scary part is that there’s no warning or explanation for the owner. Unless someone catches the crime on a security camera, there’s no way for the owner or the police to really know what happened. Many times, they think the vehicle has been towed.”

Wehrle says it’s important for law enforcement officers to be aware of this threat and be on the lookout for thieves who may be using the technology.

According to NICB’s Chief Operating Officer Jim Schweitzer, who oversees all NICB investigations, vehicle manufacturers must continue their efforts to counter the attacks on anti-theft technology.

“Vehicles are a valuable commodity and thieves will continue to wage a tug of war with the manufacturers to find a way to steal them,” said Schweitzer. “Anti-theft technology has been a major factor in reducing the number of thefts over the past 25 years. The manufacturers have made tremendous strides with their technology, but now they have to adapt and develop countermeasures as threats like this surface.”

A look at the "mystery device" obtained by NICB.

A look at the “mystery device” obtained by NICB.

While there may not be an effective way of preventing this kind of theft at this time, NICB advises drivers to always lock their vehicles and take the remote fob or keys with them. Drivers should also be on the lookout for suspicious persons or activity and alert law enforcement rather than confronting a possible thief.

It’s also a good idea to never invite a break-in by leaving valuables in plain sight. And once thieves get inside, they can easily steal a garage door opener and valuable papers such as the vehicle registration that could lead them to your home. So take the garage door opener with you and take a picture of your registration on your cell phone rather than keeping it in the glove compartment.

 

Smokies Wildfires Devastate Tennessee Communities

1632399_1280x720The recent wildfires that quickly ripped through Tennessee’s Smoky Mountains threatened the lives of tens of thousands of residents in the Gatlinburg area. The fire, likely a result of arson, has already claimed the lives of 11 people as of Friday morning.

Right now, insurance company representatives are in the field staffing catastrophe centers and working non-stop to assist victims in rebuilding their lives, their homes and their businesses. As hard as these professionals work to quickly handle the thousands of claims that these kinds of events generate, there are always some victims who experience additional pain—not from the fires, but from greedy scam artists and unscrupulous contractors.

After a natural disaster salespeople go door to door in damaged neighborhoods, offering cleanup or repair services. While many of these are honest and reputable, others are not. The dishonest ones may pocket the payment without completing the job or use inferior materials and perform shoddy work not up to code.

NICB suggests you consider these tips before hiring a contractor:

  • Get more than one estimate
  • Get everything in writing.  Cost, work to be done, time schedules, guarantees, payment schedules and other expectations should be detailed
  • Demand references and check them out
  • Ask to see the contractor’s driver’s license and write down the license number and their vehicle’s license plate number
  • Never sign a contract with blanks; unacceptable terms can be added later
  • Never pay a contractor in full or sign a completion certificate until the work is finished and ensure reconstruction is up to current code
  • Make sure you review and understand all documents sent to your insurance carrier
  • Never let a contractor pressure you into hiring them
  • Never let a contractor interpret the insurance policy language
  • Never let a contractor discourage you from contacting your insurance company

You can download our disaster fraud brochure and other fraud awareness materials here.

If you believe you have been approached by an unscrupulous contractor or adjuster, or have been encouraged to fabricate an insurance claim, contact your insurance company or call the NICB toll-free at 1-800-TEL-NICB (1-800-835-6422). You may also text keyword “fraud” to TIP411 (847411) or report it online by visiting our Web site at www.nicb.org.

‘Tis the Season to Steal

cr122k15-gift_car_openerWhen you’re making the rounds at the stores this holiday season, make sure your car isn’t on someone’s gift list. Unattended vehicles, especially those loaded with valuables, make attractive targets for thieves.

New data released today by the National Insurance Crime Bureau (NICB) shows a total of 9,600 vehicles were reported stolen in 2015 on Thanksgiving Day, Christmas Eve, Christmas Day, New Year’s Eve and New Year’s Day.

Holiday vehicle thieves had their busiest day in 2015 on Halloween, stealing 2,238 vehicles according to NICB’s 2015 Annual Holiday Vehicle Theft Report. Theft data is culled from the National Crime Information Center’s (NCIC) stolen vehicle file, which showed a total of 759,237 vehicle thefts for the year.

After Halloween, New Year’s Eve was the next most active holiday with 2,227 thefts. Labor Day came in third with 2,171 thefts followed by Christmas Eve with 2,071 thefts. Memorial Day rounds out the top five holidays for 2015 with 2,040 thefts.

On the opposite end of the spectrum, the holidays with the fewest thefts in 2015 were: Christmas Day (1,620); Thanksgiving (1,653); Valentine’s Day (1,690); President’s Day (1,787) and Independence Day (1,981).

Holidays ranked by the number of thefts in 2015 were:

  1. Halloween (2,238)
  2. New Year’s Eve (2,227)
  3. Labor Day (2,171)
  4. Christmas Eve (2,071)
  5. Memorial Day (2,040)
  6. New Year’s Day (2,029)
  7. Independence Day (1,981)
  8. President’s Day (1,787)
  9. Valentine’s Day (1,690)
  10. Thanksgiving (1,653)
  11. Christmas Day (1,620)

While the holiday with the most thefts was Halloween, the most thefts on a single day in all of 2015 occurred on Monday, June 15, with 2,579.

A special feature included in today’s report is a look at vehicle thefts occurring on Black Friday, the day after Thanksgiving, which is widely viewed as the start of the holiday shopping season. In recent years, many national retailers have launched Black Friday specials on Thanksgiving evening while families may still be carving their turkeys.

The lure of added shopping hours—and the presence of unattended vehicles in store parking lots—may be contributing to higher vehicle thefts on Black Friday.

The following graph shows the number of vehicle thefts reported on Thanksgiving Day and Black Friday from 2011 through 2015. There are, on average, over 30 percent more vehicle thefts on Black Friday than the day before. Moreover, the 2,244 thefts on Black Friday in 2015 were more than the 2,080 average daily thefts for the entire year.

 Year Thanksgiving Day  Black Friday   % Increase
2011  1,526 2,034 33
2012  1,656 2,077 25
2013  1,353 1,750 29
2014  1,384 1,838 33
2015  1,653 2,244 36


NICB reminds drivers this holiday season to make sure your vehicle is locked when unattended. Don’t leave spare keys or FOBS inside. Take a moment and be sure to hide your valuables from view. Even an empty backpack looks appealing to a thief from the outside.

If stopping at several locations to shop, remember to first store your packages in your trunk before leaving one destination for the next. Thieves are known to watch shoppers who place items in their trunks and then head for the stores—that invites trouble.

See the full holiday vehicle theft report here and an infographic here.

2015nicbholidaytheftreport

Insured Metal Theft Claims Take Dramatic Dive

nicbmetaltheft

Metal theft claims were down 29% over the past two years.

In a dramatic drop-off that extends a multi-year trend, insured metal theft claims in 2015 were down 23 percent from 2014 levels and 29 percent over the past two years.

According to a report today from the National Insurance Crime Bureau (NICB), in 2013, a total of 13,626 metal theft claims were processed. That number dropped by seven percent to 12,621 in 2014 and took a 23 percent decline in 2015 to 9,692 — a total reduction of 29 percent over the past two years.

During this three-year period, 35,961 insurance claims for the theft of copper, bronze, brass or aluminum were handled — 35,134 of them (98 percent) involving copper. When copper theft claims frequency is compared to the monthly average price of copper, there is a statistically- significant correlation between the two.

While the slowdown in thefts is encouraging, dangerous copper theft incidents continue to occur from Hawaii to Indiana to Massachusetts.

The top five states for metal theft claims over this period were Ohio (4,042), Pennsylvania (2,819), New Jersey (2,585), New York (2,101) and Texas (1,833).

The top five Core-Based Statistical Areas generating the most metal theft claims were New York-Newark-Jersey City, NY-NJ-PA (2,136), Philadelphia-Camden-Wilmington, PA-NJ-DE-MD (1,809), Chicago-Naperville-Elgin, IL-IN-WI (1,449), Baltimore-Columbia-Towson, MD (890) and Atlanta-Sandy Springs-Roswell, GA (868).

You can review and download the full report here. Download the dataset here.

While overall public awareness of these kinds of crimes helps to motivate consumers as to the steps they can take to protect themselves and their property, credit also belongs with the various state legislatures and municipalities that have enacted tough laws in recent years as a direct response to copper and other metal thefts. Many of these laws require scrap yards and other buyers of metal to document the transaction and require proof of identity to discourage thieves from trying to cash in.

There is a normal lag between legislation enactment and intended results. The laws passed in recent years may now be bearing fruit. Still, individuals need to do their part to prevent these

kinds of thefts by simply being vigilant in their neighborhoods and business communities. If dwellings remain unoccupied for extended periods of time, they become magnets for unlawful behaviors. Wire stripping is among the activities that are routinely discovered in these locations.

Your best protection is simply paying attention. Talk with your neighbors and ask one that you trust to keep watch on your home if you will be away. As always, you should report suspicious activity to your local law enforcement agency. Unreported crime tends to breed more crime.