Updated news on the Gambino, Genovese, Bonanno, Lucchese and Colombo Organized Crime Families of New York City.

Thursday, March 1, 2012

Russian mobsters charged in $275M insurance scam

A brazen gang of Russian crooks was busted today for allegedly running a record-setting, $275 million fraud that exploited New York's "no-fault" auto-accident law.
The ring -- dubbed the "No-Fault Organization" -- worked with a "cadre of corrupt doctors" to set up more than 100 phony medical clinics across the city, Manhattan U.S. Attorney Preet Bharara said.
There, they generated bogus bills for treatment of injuries that "ranged from wild exaggerations to outright fabrications," he said during an afternoon news conference.
Thousands of crash victims took part in the scam -- which dates to at least 2007 -- after being recruited by "runners" who found them at accident scenes, hospitals and through word of mouth.
Three lawyers were also accused of filing bogus personal-injury cases to further boost the take from the scheme, which Bharara called a "colossal health fraud" on an "unprecedented scale."
Some of the illegal profits paid for "lavish vacations" to Mexico and Atlantic City, "expensive jewelry" and shopping sprees at Louis Vuitton, Chanel and Saks Fifth Avenue, he said.
The fraudsters allegedly took advantage of the "patient-friendly provisions" of New York's mandatory "no-fault" automobile insurance coverage, which guarantees up to $50,000 in medical benefits for anyone hurt in a car crash.
Three dozen defendants -- including eight alleged ring members and 10 doctors -- were busted today during coordinated sweeps by the FBI and NYPD.
Manhattan FBI Assistant Director-in-Charge Janice Fedarcyk said search warrants were also executed at seven spots in Brooklyn and one in The Bronx.
Police Commissioner Ray Kelly said two undercover cops infiltrated the operation about six months ago by posing as crash victims.
Kelly said the cops were "coached" to complain about neck, back and leg pain, and were then "kept running back and forth for treatments and tests that came as close as possible to the $50,000 for each officer."
"The undercover officers were offered physical therapy, neurological examinations, electronic nerve conduction tests, X-rays, MRIs, acupuncture and chiropractic adjustments," he said.
Kelly said the "billing mills" processed up to 150 purported patients each day, with doctors getting up to $10,000 a month "to show up once a week just to sign referrals."
Todays's indictment includes charges of racketeering conspiracy and conspiracy to commit health care fraud, mail fraud and money laundering.
If convicted, the various defendants face prison terms ranging from 30 to 70 years.


Post a Comment