RD89 - 2016 Annual Report on the Insurance Fraud Program

Executive Summary:
Insurance fraud is an unfortunate reality that law enforcement deals with regularly. More than $21.7 million in fraudulent insurance claims were collected in Virginia in 2016, and insurance fraud is estimated to cost Americans more than $80 billion each year.

That is why the Virginia State Police Insurance Fraud Program (IFP) continues to march forward in its mission to Stamp Out Fraud. Since 1999, the IFP has been bringing attention to the issues associated with insurance fraud by conducting investigations and training law enforcement.

The IFP also provides a great deal of public outreach. In order for citizens to recognize and prevent insurance fraud, they must first understand what it is. Insurance fraud occurs when a person obtains or attempts to obtain money or signature by false pretense. Casualty, property and workers’ compensation are some common categories of insurance fraud.

The negative financial effect that insurance fraud has on everyone comes as a surprise to many. The more money fraudsters bilk from insurers, the more people end up paying in increased premiums. Those who commit insurance fraud are ultimately taking money out of your pocket.

Take the following investigation, for example. Virginia State Police Special Agent David Walker, acting on a referral from an insurance company, learned that a policy holder had altered a dental office invoice from $510 to $2,510 and submitted the fraudulent invoice to the insurance company for payment. The insurance company paid the legitimate portion of the claim but questioned the fraudulent amount. SA Walker conducted a thorough investigation into the suspected fraud and eventually arrested the suspect on one count of Attempting to Obtain Money by False Pretenses and one count of Forgery. Thanks to SA Walker’s investigation, the suspect was convicted and sentenced to jail time. Had this fraudulent claim gone unchecked, the suspect could have made off with $2,000.

This is just one example of the 542 investigations the IFP initiated in 2016. Attempted insurance fraud exceeded $9.8 million, and IFP investigations resulted in $229,039 in restitution.

Citizens can join law enforcement in pushing back against insurance fraud. Anyone with knowledge of suspected insurance fraud can submit an anonymous tip by logging onto StampOutFraud.com or calling (877) 62-FRAUD. Tips that lead to arrests can potentially earn an award of up to $25,000.

With the help of the commonwealth’s attorneys, citizens and the insurance industry, the Virginia State Police Insurance Fraud Program can Stamp Out Fraud in Virginia.


/s/ Colonel W. Steven Flaherty