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Twelve Charged in Scheme Involving
Faked Accidents and Referrals to
Chiropractic Clinics

On July 13, 1999, New Jersey Attorney General John J. Farmer, Jr. and Insurance Fraud Prosecutor Edward M. Neafsey announced that arrest warrants were issued for 12 individuals from New Jersey on charges of racketeering and conspiracy to commit health care claims fraud in connection with fraudulent personal injury protection (PIP) automobile insurance claims.

According to Neafsey, six people were arrested and will be taken to Central Judicial Processing Court in Union County. Efforts are continuing to effect the arrests of the remaining six persons. In addition to arrests warrants, the Office of Insurance Fraud Prosecutor (OIFP) executed search warrants at eight chiropractic clinics or medical billing offices, two private residences, and also searched two automobiles seeking evidence of additional fraud crimes.

The Attorney General said the OIFP investigation, with assistance from the Division of State Police, FBI, Union County Prosecutor's Office, Hudson County Prosecutor's Office and Immigration and Naturalization Service, began after his office received an anonymous letter and information from several New Jersey-based insurance companies.

"Personal injury protection claims represent the 'health and injury' component of automobile insurance and is one type of criminal insurance fraud that our Office of Insurance Fraud Prosecutor is targeting," said Attorney General Farmer. "We are using our criminal and civil resources to the fullest extent to identify and prosecute individuals and entities whose swindling inflates insurance costs for honest New Jersey citizens."

Neafsey said that the alleged ring leaders, Victor Almonte, a/k/a "Bacana," 33, of Elizabeth, Union County; Alejandro Ventura, a/k/a "Alex," 34, of Elizabeth; Anhuar Bandy, 36, of New Brunswick, Middlesex County, were arrested this morning by OIFP investigators. The three were variously charged with second degree conspiracy to commit health care fraud and racketeering. Bail was set at $100,000/10% for Almonte, $400,000 cash for Ventura, and $500,000 for Bundy.

"This case marks two firsts for the State of New Jersey. It is the first organized fraud ring penetrated by undercover investigators from OIFP and the first organized fraud ring prosecuted under the tough new health care claims statute," according to Neafsey. "Our office intends to utilize every tool provided by the legislature in carrying out the mission we have been given."

The investigation began following the receipt of an anonymous tip. Several insurance carriers were then contacted and information about the submission of fictitious automobile insurance claims for payment of chiropractic and related services was developed. Neafsey said that the alleged scheme involved staging automobile accidents. Co-conspirators accepted money in exchange for staging the accidents and referring patients to various chiropractic clinics located throughout New Jersey.

Bandy is alleged to have owned or operated the clinics and Ventura and Almonte served as "runners," recruiting people to participate in staged automobile accidents, according to Neafsey. In addition to racketeering and health care claims fraud, the defendants may also face civil charges from the affected insurance carriers.

The Attorney General thanked the following insurance carriers for their cooperation with the investigation: Allstate, Liberty Mutual, MDA, Parkway, Prudential, Selective, Sentry and State Farm.

The co-defendants charged with participation in staged accidents and the approximate amounts they are charged with stealing based on the conspiracy to file false claims with insurance companies are:

Further information can be obtained from Paul Loriquet or Roger Shatzkin (609) 292-4791

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This article was posted on August 22, 1999.