Introducing the Dirty Dozen: 12 fraudsters enter the Hall of Shame

December 28, 2023 11:18 AM

Fraudsters never seem to run out of pathetic schemes to perpetrate insurance fraud and the Coalition Against Insurance Fraud has inducted 12 new entrants into the 2023 Hall of Shame.

Insurance fraud siphons off a staggering $308.6 billion annually, according to the Coalition's study, and this scourge not only drives up premiums for honest Americans, but it also inflicts physical harm upon those who fall prey to the fraudsters they once trusted. Each year, the Hall of Shame shines a light on wrongdoers who thought they could get away with defrauding insurers but didn't.

Recognizing these individuals helps to galvanize public opinion against insurance fraud and their cases illustrate the real-life consequences of fraudulent activities, fostering a collective determination to combat this pervasive problem. These schemers have all faced the consequences of their actions, and their stories highlight that fraud investigators and prosecutors are unwavering in their pursuit of justice.

Slipping and falling into prison.

Worker with back injury, concept of accident at work

Two unscrupulous lawyers and a greedy doctor combined forces to create a $31 million fraudulent trip-and-fall scheme that targeted local businesses and their insurers. The two personal injury lawyers, Marc Elefant and George Constantine, worked together with a surgeon, Andrew Dowd, to recruit the most vulnerable members of society and force them to injure themselves so their lawyers could make a quick buck. Instead of upholding the law, they went on an unlawful spree and filed hundreds of fraudulent lawsuits so they could steal from small businesses and insurance companies. At the same time, Dowd, a doctor who had promised to "do no harm," was performing hundreds of medically unnecessary surgeries to earn thousands of dollars for each case.

Initially, the terrible trio told their victims to lie about their injuries, but eventually they made their victims engage in real accidents and injure themselves for real. The three will now be getting what they deserve. Constantine and Dowd face over eight years in prison, and Elefant faces two years, and they were each sentenced to three years of supervised release. In addition, they will have to repay all of the stolen money. Constantine was further ordered to pay over $4.7 million, Dowd almost $3 million, and Elefant nearly $1 million. We can thank the United States Attorney for the Southern District of New York for having them slip and fall directly into jail.

Glamorous doctor receives prison prescription.

Fransico Patino loved the spotlight and seemed to live larger than life by paying to appear on national TV shows, sponsoring boxers, cage fights, and even the Ultimate Fighting Championship World Champions and Hall of Famers. To many, this alligator-wrestling doctor was on his way to becoming a sensation with his new diet book. The reality, however, was that it was a high-profile act to launder his appearance and money to seem like he was a legitimate doctor. Patino was not the man he portrayed and the glamorous appearance he had been working on was just as fraudulent as his work. He wasn't a hotshot doctor; instead choosing to take advantage of vulnerable people by offering them opioids if he could bill them through Medicare and Medicaid for unnecessary and sometimes painful injections. Patino chose stardom over his patients, using them to pay for his expensive lifestyle and lived a luxury life filled with jewelry, cars and international vacations.

The multiple medical practices and clinical laboratories he owned in Michigan played a critical role in developing and implementing a "shots-for-pills" protocol at several pain clinics. His unfortunate patients were required to receive unnecessary back injections in exchange for prescriptions of dangerous, addictive and medically unnecessary opioids. Throughout the scam, he prescribed over six million doses of opioids. Even worse, Patino knew he was violating the law and wrote emails acknowledging that such practices constituted a "violation of the Stark and Anti-Kickback laws." Now the good doctor faces 16.5 years in prison, where he'll be in good company as several other defendants have been sentenced or plead guilty to participating, including 12 other physicians who were trained in Patino's protocols, along with many non-physician defendants who participated in the conspiracy.

Brace yourself, or just fake it.

Usually, when someone orders equipment or supplies, they will arrive in the office or workplace. Christopher Margait was ordering an unusually large amount of Durable Medical Equipment (DME) like back, knee and wrist braces, but the office never seemed to get any actual equipment. Margait, along with his partner in crime, Matthew Witkowski, generated fake orders for DMEs using a call center in the Dominican Republic, and billed Medicare and Medicaid for the orders before selling them to suppliers to help counterfeit prescriptions. The fraudsters were responsible for at least $7 million in fraudulent charges to Medicare and received more than $3.8 million of the money directly by stealing actual Medicare users' names and private medical information without their knowledge.

The United State Attorney for the Southern District of New York announced in May 2023 that Margait, 45, was sentenced to 65 months in prison for conspiracy to commit healthcare fraud.

Margait, of West Palm Beach, Florida, pled guilty to a single count of conspiracy to commit healthcare fraud. In addition, he was sentenced to three years of supervised release and ordered to pay forfeiture of $3.8 million and restitution of $7 million to the Medicare program. Witkowski, 38, a U.S. citizen who resided in the Dominican Republic for almost two decades, was sentenced to 60 months in prison and three years of supervised release. The court ordered him to pay forfeiture of just over $4 million and restitution of $8.1 million to the Medicare program.

Sweetie Pie’s star isn’t such a nice guy after all.

James "Tim" Norton, the former star of the St. Louis-based television reality show Welcome to Sweetie Pie's and co-owner of the Sweetie Pie's soul food restaurants, was a well-loved member of his community. But his nice-guy persona didn't match the real person underneath. Norman took out a $450,000 life insurance policy on his nephew, Andre Montgomery Jr., who was subsequently lured into an alleyway and shot to death only months later. Norton was the sole beneficiary of the policies.

This half-baked scheme has left his family divided and Norton faces life in prison for his crimes.

Myrle Miller maliciously murdered her man for money.

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John Nichols believed he had over $250,000 in his personal accounts, but his family suspected something was happening with his wife. Myrle Miller, 78, married Nichols in 2012, had been systematically stealing money from him through forged checks, fraudulent bank loans and even made herself the beneficiary on two life insurance policies. When she was about to be exposed, she killed him by mixing large amounts of her medications with his and putting them in his coffee. She was a con artist who, soon after Nichols' death, Miller married her fourth husband. It turns out this was her modus operandi. In 1986, Miller was accused of attempting to kill her first husband by poisoning his cocktails, though she was acquitted in that case.

Miller had been caught by some of Nichols' family, who had hired a private investigator to look into their accounts. They learned that Miller had stolen all of his money and drugged her husband to death. What had seemed initially like a simple heart attack was revealed to be way more sinister after an autopsy.

A Union Country jury found her guilty of first-degree murder and five other felonies. "The defendant was systematically emptying her husband's bank accounts, and upon being found out, made the deliberate and intentional decision to kill him," said Pennsylvania Attorney General Michelle Henry in a statement. "It is hard to fathom acts more cold, calculated, and self-serving…"

Owner uses arson and attempted murder to save failing business.

Zef Gjurashaj knew that his business, Andiamo's Restaurant in Newburgh, NY, was in financial trouble in 2017 and opted to set it on fire for the insurance payout. It's a common solution and he enlisted the help of his nephew's wife, Marina Gjurashaj, exploiting her immigration status to convince her to help him. Marina started the fire, causing a propane leak to make it burn even brighter. Authorities said the fire was of such ferocity that in addition to decimating the building, it put the first responding firefighters and Zef Gjurashaj's wife, who was present at the time of the fire, at grave risk of death. Turns out, that was all part of the plan. Zef had purposefully ensured his wife was at the location when the fire started, attempting to trick Marina into killing both his business and his wife.

Before the trial, Marina Gjurashaj, 38, of Yonkers, pleaded guilty to third-degree arson and fourth-degree conspiracy for her role in setting the fire. As part of her plea agreement, Marina Gjurashaj testified against Zef Gjurashaj. It turns out prosecutors had a transcript of a phone conversation between Zef and his wife, where he purposefully made sure she would be present when the fire was set. Not just a fraudster but an attempted murderer. Zef Gjurashaj was sentenced to 20 years to life in prison for the arson charge. He was also sentenced to concurrent terms of imprisonment for conspiracy, insurance fraud, tax fraud, and one of the reckless endangerment charges.

Workers’ comp fraudster is swept away to prison.

Gina Gregori was a master at cooking the books and forging her business documents, but the fraud finally caught up to her. Over six years, she had grossly underreported payroll to the State Compensation Insurance Fund and private insurers for her San Francisco-based janitorial company. Not only did she keep separate records for payroll to submit to the state and private organizations, but she would constantly change the name of her business in the state's records and change the owner to a family member so she could claim to be a new business and have lower premiums. At the same time, she was underpaying her workers, many of whom were undocumented immigrants and had no idea they were being treated unfairly. Gregori's crimes threatened not just insurers and the government but endangered her workers and cost both residents and taxpayers. Holding her and others like her accountable is critical to protecting vulnerable workers and other law-abiding businesses. Now she's being forced to pay back over $8 million and faces six years of jail time.

Insurance broker sells schemes and lies.

Indiana insurance broker Bruce Ford stole approximately $1.2 million from several victims through a simple Ponzi scheme between 2013 and 2018. He promoted investment services to current and former insurance clients even though he was not registered with the Indiana Securities Division, which is legally required to operate that type of business. He promoted himself as a financial adviser and convinced many of his clients, who were elderly retirees, to invest their individual retirement accounts and 401Ks. Instead of investing their funds, he transferred the money, over $1.2 million, to his own bank accounts to pay his personal credit cards, and to purchase goods, services, a mobile home, land, and a recreational vehicle. He managed to keep this scheme going for five years, but justice always has a way of catching up to people who commit insurance fraud like Ford. He was sentenced to 51 months in federal prison, ordered to pay $1,089,708 in restitution, and will have three years of supervised release when he leaves prison.

Man paralyzed by greed bounces back to play basketball.

Josephine Perez-Gorda claimed that her husband had been 'paralyzed from the belly down' after a horrific accident while on active duty in the Army. The couple contacted Veterans Affairs and Social Security and applied for and received funding for a specially equipped vehicle, a specially adapted home, and additional compensation based on his disability rating. The only problem? Mr. Perez-Gorda couldn't seem to sit still to continue the charade of being paralyzed but instead could actually walk, run and even jump. His secret came out after a San Antonio news station, KENS5, aired a story titled, "Homes for Our Troops Questions Veteran's Paralysis after Video."

Turns out, Mr. Perez-Gorda had been caught on video playing basketball. This wasn't a respectable game of wheelchair basketball either; he had been caught running down the basketball court like it was nothing. Hardly paralyzed, the couple had been caught in broad daylight! The now-late husband had helped his wife fill out all the paperwork to lie and receive all sorts of payments, but she faces her sentence alone. She was found guilty on Sept. 22, 2022, of 11 counts of wire fraud, one count of mail fraud, one count of healthcare fraud, three counts of false statements related to a healthcare matter, one count of conspiracy to commit healthcare fraud; and one count of theft of government funds. She faces 23 to 46 months in prison and was ordered to pay $501,000 in restitution for defrauding the Department of Veterans Affairs and the Social Security Administration of more than $500,000. In addition to the sentencing and restitution, Perez-Gorda is responsible for a $100 special assessment on each of the 18 counts and $100,000 for trial expenses. The game was up, and it was a slam dunk for justice.

Perpetrator tries to profit from a hit and run.

SeongJoon Cho/Bloomberg

When Melissa Brewer hit a motorcyclist with her car on Highway 101 in California, she tried to profit from it. Attempting to merge onto the highway, the motorcyclist had been rammed recklessly by a white Hyundai Veloster that sped away, leaving the motorcyclist with a broken ankle. Five days later, Brewer filed an insurance claim indicating her white Hyundai Veloster had been in a single vehicle collision when she drove off the road and into a guardrail. She also told her insurer she was receiving medical care due to the collision.

The California Highway Patrol's Multidisciplinary Accident Investigation Team (MAIT) determined the Veloster's damage was consistent with a multiple-vehicle collision, not a guardrail, and concluded a collision with the motorcycle caused the specific damage to the Veloster. Great investigative work led to a quick check via the county's vehicle registry for cars that matched the description of the recent motorcycle crash and found the perfect match with Brewer's car. With overwhelming evidence, District Attorney Dan Dow found Brewer guilty of a felony hit and run causing injury to a motorcyclist. Brewer was also convicted of four felony counts of insurance fraud and one misdemeanor count of reckless driving.

Collison center owner files 300 false claims.

Loss adjuster wearing hi-vis safety vest standing in compound for damaged cars taking photo for insurance claim report on digital tablet

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John Paul Reis, 56, of Newtown Township in Pennsylvania, took insurance fraud to a new level, perpetrating the same scheme nearly 300 times over an eight-year period. As the owner of the Chalfont Collision Center, Reis made hundreds of insurance claims on behalf of his business. The company was a direct repair center for Erie Insurance and several other carriers, so it had been verified by these insurers and was authorized to write estimates, complete the repairs, and then submit the invoices to the carriers to shorten the repair and downtime for customers.

Reis had concocted a seemingly perfect scheme, where he would wipe a compound mixture onto the body of several vehicles and sometimes strike them with a hammer, making it appear as if the vehicles were involved in an accident so he could bill insurance companies for more money. The investigation into Reis began when Bucks County (PA) detectives received a referral from Erie Insurance's Special Investigations Unit alleging that the company was enhancing or creating damage to customers' vehicles to increase their charges. SIUs from Nationwide Insurance, Erie Insurance, CSAA Insurance Group, Liberty Mutual Insurance and NJM Insurance assisted with the investigation.

After being caught, Reis entered an open guilty plea in March 2023 to several third-degree felonies: insurance fraud, deceptive business practices, forgery, and theft by deception. He was sentenced to 84 months of restrictive probation and must pay $435,246.69 in restitution, and his repair credentials have been suspended. It'll take a lot of work for Reis to repair that damage.

Organic farmer makes crop fraud profitable.

James Clayton Wolf, 65, a certified organic farmer, falsely sold $46 million of non-GMO corn and soybeans as organic from 2013 to 2021, netting more than $19.6 million in profits. Wolf had been forging copies of his National Organics Program certifications, but his certification was revoked in 2020 and he lied about growing his crop without GMOs or chemicals. Organic crops are grown without the use of GMOs or chemicals, and farmers are required to follow strict protocols when it comes to planting, fertilizing, harvesting, storing, and transporting the crops labeled as organic. Wolf seemed to think these restrictions were too costly, so he decided that lying was easier.

However, this crime wasn't committed alone. While Wolf was hocking bad crops; he got someone to lie for him to ensure that his produce could be insured at a better rate. Adam Clifford Olson, owner and operator of Olson Seed LLC in Windom, Minnesota and Wolf's godson and nephew, had the indictment against him dropped as part of the agreement with prosecutors. According to Olson's plea agreement, he admits that he misrepresented the extent of his involvement in Wolf's farming operation when Olson applied for crop insurance in April 2020 for organic crops farmed by Wolf. As a result of this application, the Federal Crop Insurance Corp. awarded over $69K in total subsidies and reimbursements to Wolf's operation for 2020.

Wolf pled guilty and admitted to purchasing real estate, farm vehicles and equipment, and investments with the proceeds of the sales and as part of the plea agreement, will forfeit the $19.6 million in proceeds. A federal judge sentenced the farmer to three years in prison and Olson to two years of supervised probation and 100 hours of community service. Olson has already provided almost $70,000 in restitution to the USDA.

Obviously, insurance fraud isn't as profitable as some might think.