No Sympathy: Injured Claimant Without Auto Insurance Due to Fraud Barred From Bringing Personal Injury Claim

In Bencosme v. Kannankara, no. A-1672-14T3 (App. Div. Mar. 22, 2016), the New Jersey Appellate Division concluded that the apparent harshness of the decision was not a sufficient basis for it to refuse to affirm a trial court’s ruling that dismissed a personal injury lawsuit against a claimant who failed to carry statutorily required auto insurance, even though the claimant was uninsured as a result of fraud. Federico Bencosme was involved in an auto accident with Joseph Kannankara in which
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GAO’s Update on ACA Enrollment Process: CMS Encouraged to Take Steps to Monitor Program Cost, Risk, and Performance

The issue of fraud is still alive and well with respect to the health care exchanges established by the Affordable Care Act (ACA). The Government Accountability Office (GAO) recently issued a new update with respect to fraud in the federal exchanges. In that report, the GAO recommended that the Center for Medicaid and Medicare Services (CMS) strengthen enrollment controls and manage Fraud Risk. The report notes that implementation of the new eligibility and enrollment provisions for the first year was
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In New Jersey, Insurance Fraud Does Indeed Equal Prison

It is no secret that New Jersey courts have a tendency to treat insurance policies different from standard contracts, at least in part because the insurance industry is heavily regulated and affects the public interest. In its ruling in State of New Jersey v. Goodwin, No. A-20 (N.J. Jan. 19, 2016), the New Jersey Supreme Court has drawn a definitive hard line in the sand in the fight against insurance fraud. The New Jersey Supreme Court ruled that a defendant
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Daughter Does Not Have to Pay for the Sins of Her Mother: Insurer Entitled to Restitution from Insureds but Appellate Court Remands Damage Award

The 2015 holiday season might be a bit tense for a mother-daughter team ordered to pay restitution to their insurer for fraud and misrepresentation. Secura Ins. v. Thomas, 2015 Mich. App. LEXIS 2230 (Mich. App. December 1, 2015). While restitution was owed for the wrongful acts, the court held joint and several liability did not apply to frauds in which a party (the daughter) was not directly involved. This case presents an example an insurer performing excellent due diligence in
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Logical Construction: Federal Court Relies on Practical Considerations in Finding No Coverage for Lost Future Earnings

In 3M Co. v. National Union Fire Insurance Co., 2015 U.S. Dist. LEXIS 131197 (D. Minn., September 28, 2015) a federal judge for the District of Minnesota determined that a policyholder was not entitled to coverage for earnings on its investment in a trading company engaged in a Ponzi scheme because it did not own the earnings. The policyholder invested its employee-benefit plan assets in the trading company. The investment took the form of a limited partnership in the trading
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Insurer Required to Pay Policyholder Attorneys’ Fees Despite Policyholder Misrepresentations

The Florida Third District Court of Appeal found that an insurer was required to pay attorney fees that homeowners incurred during a coverage dispute despite a finding that the policyholders committed fraud. The Third District affirmed the lower court’s decision, finding that the insurer was required to pay the policyholders’ attorneys’ fees because the insurer lost its counter-claim against the policyholders. The court found that there was no exception for fraud. In Citizens Property Insurance Corp. v. Bascuas, (Third District
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Feels like a Fraud: Fifth Circuit Rules in Favor of Insurer; Awards $6M in Fraudulent Claims Case

In Allstate Insurance Company et al. v. Michael Kent Plambeck, DC, et al. United States Court of Appeals for the Fifth Circuit, September 17, 2015, an insurer was awarded a $6 million verdict against a group of chiropractors, lawyers and telemarketers that coerced individuals into making fraudulent claims against the insurer. The District Court awarded the verdict based on the Racketeer Influenced and Corrupt Organizations Act (RICO). On September 17, 2015, the Fifth Circuit Court upheld the verdict. The insurer
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Policyholder Required to Pay Back Insurer $900,000 Based on Misrepresentations

A Texas appellate court upheld a substantial jury award against a policyholder on fraud claims in Jackson Fulgham v. Allied Property and Casualty Ins. Co.. The insurer counter-sued the policyholder real estate firm over fraudulent claims it had made about hailstorm damage, resulting in a $900,000 jury award in favor of the insurer. The appellate court upheld the verdict claiming that the evidence supported such finding. In 2009, the policyholder made a claim under its property insurance policy for damage to the
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Introducing Our Latest Insurance Newsletter: Insurance Fraud Reporter

The Insurance Fraud Reporter is dedicated to the proposition that fighting insurance fraud is not just a statutory mandate or moral imperative — it is a business imperative. For a free copy, click here. We invite you to subscribe to upcoming editions of the Insurance Fraud Reporter by clicking here. Editors: Anthony J. Golowski II and Jonathan M. Kuller
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