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October 15, 2020

Seventeen defendants who collectively received nearly $900,000 in improper crop insurance indemnity payments, have agreed repay the United States.  Defendants admitted that they submitted false claims for payments to federally-backed multi-peril crop insurance policies, including by falsely stating that the tobacco crops in question had been damaged, inflating crop loss amounts, and submitted falsified documentation about the quality of the tobacco crop.  USAO ED KY

January 17, 2020

Citibank, N.A. will pay $18 million to the Office of the Comptroller of the Currency to resolve claims that it violated the Flood Disaster Protection Act by failing to "force-place" flood insurance on behalf of borrowers as required by law.  OCC

March 14, 2019

The former owner and former COO of Atlanta-based Primera Medical Group, Shailesh Kothari and Timothy McMenamin, were sentenced to prison terms of 6.75 and 7.75 years, respectively, for their roles in submitting more than $8.5 million in fraudulent invoices to private insurance companies for allergy testing and allergy immunotherapy services that were never provided and were not medically necessary.  Defendants submitted bills using the NPIs of doctors who had not performed the tests and, in fact, had no knowledge of the services.  To cover up the fact that the services were not provided, defendants would create false laboratory reports for insurers and patients who requested them.  USAO ND GA

February 20, 2019

New York City will pay $5.3 million to resolve claims that the city sought FEMA recovery funds for certain city-owned vehicles claimed to have been damaged during Superstorm Sandy.  However, the city provided inadequate training to officials regarding the identification of vehicles damaged as a result of the storm, and officials made no effort to inspect the vehicles or determine whether the claimed damage was, in fact, a result of Sandy.  Many of the vehicles for which the city sought full replacement costs had been nonoperational prior to the storm.  USAO SDNY

January 4, 2018

Kmart Corporation agreed to a $1 million settlement with the California Department of Insurance to resolve a whistleblower claim brought under the California Insurance Fraud Prevention Act.  KMart contracted with insurance companies to be reimbursed at a rate based on the company's charges to cash-paying customers, but was alleged to have submitted claims to private insurers in amounts that exceeded the agreed-upon rates.  CA

December 8, 2017

Jason Sparling agreed to pay $180,000 to settle allegations of violating the False Claims Act by submitting to the USDA an application for a drought disaster payment under the Livestock Forage Disaster Program and receiving a $95,000 payment when in fact none of Sparling’s cattle were on the drought stricken pasture during the qualifying period.  DOJ (DSD)

September 5, 2017

Novo Nordisk, Inc. has agreed to $1.1 million to resolve claims that its diabetes drug Victoza was unlawfully promoted for off-label use in violation of the California Insurance Frauds Prevention Act.  The claims were brought in a whistleblower action under that act filed by former Novo Nordisk researcher Peter Dastous, who will receive a share of the settlement.  CA

January 30, 2017

Florida announced a $1.5 million life claim settlement agreement reached with subsidiaries of the Ameriprise Group, RiverSource Life Insurance Company and RiverSource Life Insurance Company of New York. The settlement agreement focuses on the one-sided use of the Social Security Administration’s Death Master File to stop paying a deceased person’s annuity, but not using the same information to find and begin paying the deceased’s family or other beneficiaries for life insurance policies. Florida, California, New Hampshire, North Dakota and Pennsylvania conducted the examination into the companies that led to this agreement. Florida’s allocation of the multi-state settlement payment by Ameriprise is more than $111,000, which covers the costs of the investigations and future compliance monitoring. To date, state insurance regulators have either reached settlements or concluded the investigation of 28 of the top 40 companies constituting 80 percent of the total market. Efforts continue to be focused on the examination of the remaining 12 insurers. FL

January 26, 2017

New Jersey filed two separate actions against home improvement companies and their owners alleging they used deceptive business practices in order to obtain $1.4 million in federal relief funds from 51 homeowners who paid them to repair and elevate their storm-damaged properties. Named in the first Complaint are father and son contractors Paul Zaidinski, Sr., and Paul Zaidinski, Jr., and their Point Pleasant-based company, Shore HL, Inc., which does business as “Shore House Lifters.” Named in the second Complaint are contractor George Rex and his Pleasantville-based companies, Atlantic Coast Housing Lifting, LLC and George Rex Construction, LLC. The defendants engaged in “unconscionable consumer practices” that include taking money from consumers to renovate, rebuild, and/or elevate Sandy-damaged homes and then failing to begin work, performing the work in a substandard manner, and/or abandoning unfinished projects without returning for weeks, months, or at all, according to the State’s Complaints. NJ

November 21, 2016

Pennsylvania announced the filing of criminal charges against 50 individuals following investigations by the Office of Attorney General’s Insurance Fraud Section. The charges are part of a November sweep conducted by the Insurance Fraud Section, which is the largest law enforcement entity in Pennsylvania with specific authority to investigate and prosecute cases of insurance fraud. The total potential fraud involved in these cases is more than $1.1 million. The charges announced involve some of the most common types of insurance fraud. PA
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