Wrangell man indicted of insurance fraud after submitting
false claim to automobile insurer
December 11, 2004
On September 28, 2004, the State of Alaska agreed to a plea bargain with the offender on the charges handed down by the grand jury. The offender - whose name was not released - pled guilty to a reduced misdemeanor charge of attempted theft in the second degree and the second count was dismissed. He was then sentenced in the Wrangell's District Court, where he received a 12-month sentence, a fine of $5,000, and a two-year probation.
"It is cases like this one that cause the average citizen higher premiums," said Division of Insurance Director Linda Hall. "We intend to investigate all potential illegal activities because of the increase in insurance fraud throughout the nation."
The Division of Insurance's investigative report documented that in February 2004, the Division received a report from Progressive Insurance Company concerning a potential fraudulent automobile insurance claim. The insurance companies are statutorily mandated to report suspected fraudulent insurance claims to the Division of Insurance.
The offender reported to Progressive Insurance Company that he was involved in an automobile accident with his 2000 Ford Mustang on December 25, 2003 in Wrangell, Alaska. It was estimated that vehicle suffered $3,070.16 in damage.
The investigation revealed that the automobile was added to the offender's insurance policy on December 23, 2003. Wrangell Police conducted an investigation that documented that the offender was actually involved in the accident on December 21, 2003 - two days before he added the vehicle to his insurance policy.
The investigation also uncovered that the vehicle's transfer of title was signed on June 30, 2003, yet Progressive's investigation claimed that the offender purchased the vehicle on August 28, 2003. According to Progressive's policy, a vehicle must be added within 30 days of purchase to maintain coverage, but the offender didn't add it until December 23, 2003.
Because of the fraudulent representations made by the offender, Progressive Insurance Company denied the claim. In accordance with the insurance laws, a person commits a fraudulent or criminal insurance act if they present to an insurer a written or oral statement in support of a claim for payment or other benefit under an insurance policy, knowing that the statement contains false, incomplete, or misleading information concerning a matter material to the claim. A person who assists or conspires with another to commit the crime can also be charged. A fraudulent claim in the amount of $500 or more is a felony offense.
"It is satisfying to see the Division's efforts result in a conviction and sentence which serves as a clear message to the public regarding the seriousness of insurance fraud," said Insurance Investigator Schuyler Cox. "Protection of our consumers is paramount."
The Division of Insurance is committed to providing consumers fair but vigilant regulation while promoting a competitive environment for insurers. The Department regulates and licenses insurance companies, agents and brokers, and insurance agencies and monitors the financial solvency of the insurance industry in Alaska.
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