Attorney General Kane: Insurance Fraud Carries Big Risks, Costs

HARRISBURG – Attorney General Kathleen Kane is warning Pennsylvania residents that insurance fraud can get them into a lot of trouble and that costs trickle down to every resident.

Kane’s office has released its monthly newsletter detailing the office’s insurance fraud arrests and convictions.

“Insurance Fraud is one of the most costly white-collar crimes in America today, with estimated losses in the billions of dollars annually,” Kane said. “The cost of insurance fraud is paid for by all of us through increased insurance rates, and higher costs for goods and services, business expenses and health care.”

The Office of Attorney General’s Insurance Fraud Section is the largest law enforcement entity in Pennsylvania charged with specific authority to investigate and prosecute insurance fraud. The section’s attorneys and agents strive to protect and ensure the integrity of the system, as insurance impacts many aspects of every Pennsylvanian’s quality of life.

The Insurance Fraud Section’s newsletter for July 2014 can be downloaded herePast monthly newsletters can be found on the Insurance Fraud section of the Attorney General’s Web site.

Common types of insurance fraud include false reports of auto accident circumstances and timing, home burglary, personal injuries and health insurance claims, prescription drug diversion, “slip-and-falls” and working while collecting workers’ compensation benefits. Many examples of insurance fraud can be found here.

From January 2013 to July 2014, the section has made 216 arrests. In the same time period, the section is also responsible for more than $3.58 million in restitution being paid, and $245,800 in fines and 10,970 hours of community service being ordered. The efforts of the Attorney General’s Insurance Fraud require the use of no taxpayer funds.

In 1994, legislation was enacted in Pennsylvania establishing the Insurance Fraud Prevention Authority (IFPA) and a Fraud Trust Fund.  All insurance companies, authorized to transact business in Pennsylvania, pay an annual assessment into the Fund.  These funds provide financial support to the Insurance Fraud Section and other law enforcement agencies to support insurance fraud investigations and prosecutions.

Private citizens can report allegations of insurance fraud using this online form or calling the IFPA’s hotline at 1-888-565-IFPA (4372).

If consumers have a complaint involving an insurance company that does not involve fraud, they should contact the Pennsylvania Insurance Department at 1-877-881-6388 or the Attorney General’s Bureau of Consumer Protection at 1-800-441-2555.

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