The Crime of Insurance Fraud in Colorado
One of the less prosecuted crimes in Colorado – although that is changing – is the crime of insurance fraud. Although each jurisdiction in Colorado has the right to investigate and bring charges of insurance fraud – the task often falls to the Colorado State Attorney General’s Fraud Unit. This webpage addresses the prosecution of these cases.Concerning the Colorado Department of Law Insurance Fraud Unit
The Insurance Fraud Unit (“Unit”) is part of the Department of Law’s Financial Fraud Unit within the Criminal Justice Section of the office. The Unit investigates and prosecutes criminal offenses relating to insurance fraud. Typical cases involve theft and forgeries. The Unit consists of two attorneys, four investigators, one paralegal, and half of the time of one administrative assistant.
Fraudulent insurance claims referrals from the Colorado Division of Insurance increased by 54% in 2010, up from 527 in 2009, 337 in 2008 and 272 in 2007 as a result of the poor economy in the past few years.
During 2011, the Unit processed 579 referrals of potential criminal cases relating to insurance fraud. Most of these referrals were made to the Unit by the Colorado Division of Insurance. Other sources of referrals were law enforcement agencies and the National Insurance Crime Bureau (NICB).
The Unit often works large complex cases both internally and in conjunction with other law enforcement agencies. The Unit – each year – conducts several large investigations and uses the statewide grand jury to investigate and indict individuals and companies they pursue. State District Attorneys – without the same extensive funding sources – will refer the larger cases to the States Attorney General. A few counties, notably Arapahoe – Douglas, Denver, and Jefferson County have economic crime units that have the capacity to take on major complex crimes.
In 2011, the Unit opened 96 new investigations. The Unit filed a total of twenty-nine new cases in Colorado courts. The cases were filed in Adams, Arapahoe, Denver, Douglas, El Paso, Morgan, Montrose and Weld Counties. Eight of these cases were initiated by indictments issued by the Colorado Statewide Grand Jury; the other twenty-one were direct filed by Complaint and Information.
Through a joint effort with the Attorney General’s Auto Theft Unit, the Colorado Attorney General’s office shut down an insurance-fraud ring that defrauded insurance companies using staged automobile accidents and other fraudulent insurance claims.
The Unit most often charges crimes such as theft, forgery and violations as well as making extensive use of the Colorado Organized Crime Control Act (a class 2 felony),
Here are some examples of the types of insurance fraud cases they prosecute and publish online:Trenton Stone
was charged in 2007 with both working as an accountant while drawing full medical disability pay and embezzling about $250,000 from one of his clients. He had worked for the state of Colorado as an accountant at the time he filed his disability claim. The case went to a jury trial in May of 2009, in Arapahoe County District Court, and the defendant was convicted of felony theft.Susan Weiss-Nakash
was indicted by the statewide grand jury in May of 2009 for two counts of felony theft relating to mortgage fraud. Weiss-Nakash used her mortgage company, Miracle Mortgage, to create fraudulent loans to illegally obtain monies from both a lender and a title insurance company. She then deposited those funds into accounts for her personal use. She pled guilty to both counts in December and was sentenced to ten years of probation, 25 hours of community service and ordered to pay restitution in the amount of $189,100.65 to the defrauded companies.C.P. Fortney, Terry Robinson and Mary Catherine Cross
were indicted by the statewide grand jury in May of 2009 and charged with multiple counts of bribery and theft. Fortney was a used car salesman, Robinson was a field claims adjuster, and Cross was an in-house claims adjuster. Fortney paid bribes to Robinson to write estimates showing that wrecked vehicles were total losses, and paid bribes to Cross to arrange to sell the cars to him without salvage titles. Fortney repaired the vehicles and sold them to members of the public without disclosing that the vehicles had been rebuilt from salvage. Robinson and Cross have entered into plea bargains and have agreed to testify against Fortney.What Now?
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