11 Outrageous Cases of Insurance Fraud

Fraud

Insurance fraud is an area where many criminals target their sights while seeking fast money in large amounts. They believe that they can cash in on fraudulent claims and never be caught or suffer repercussions for their actions. Insurance fraud actually does have consequences, even when the perpetrators are not caught. Insurance premiums can go up across the board, and innocent customers end up paying the costs.

These eleven outrageous cases of insurance fraud were instances where the criminals were caught in the act and suffered the direct results of a life of crime:

1.      Isabel Parker, Slip and Fall Queen

Parker, seventy-two years old at the time of her sentence, was convicted of insurance fraud regarding false slip and fall claims. Her slight, aged appearance helped her to gain over $500K in claims from various entities, from liquor stores to property owners. When the insurance companies for the companies approached her with settlements, she accepted.

In April 2004, Parker was sentenced to a total of twenty-nine months of prison time, and was allowed to serve the time out in probation in Philadelphia. Parker had a gambling problem that her lawyer stated was the root of her committing insurance fraud.

2.      John Darwin, Returned from the Dead

Darwin and his wife Anne, from Seaton Carew in the UK, saw a quick and relatively painless way out of their rising debt: John would set out in to the open sea on a homemade canoe and die while on his adventure. The Darwins managed to fool everyone around them with the fake death, including their adult sons and police officials. An extensive search of the waters where he set out turned up nothing except his wrecked canoe.

Anne collected money from life insurance as well as mortgage insurance. Darwin took up residence in another property the couple owned in the UK, and the Darwins decided to move to another country to avoid discovery. When they began to sell their property, they diverted the funds to Panama. Authorities closed in and Darwin decided to return to the UK and claim he had had amnesia during the past five years.

3.      George Guldi, Claim to Fame

Guldi, a former New York legislator, was sentenced to twelve years in prison for taking an insurance check from AIG that was written out to Countrywide Home Loans, the mortgage holder on Guldi’s home that had been destroyed in a fire. Guldi fraudulently endorsed the check and deposited it into his personal account.

4.      Gerald Hardin, The Chainsaw Man

Hardin and his buddy cooked up what they thought would be the best insurance scam ever. Hardin and another friend would cut off his friend’s hand with a pole saw and then they would file a dismemberment claim against someone’s homeowner’s policy for $670K. The plot was discovered, and Hardin faces up to twenty years behind bars and $250K in fines.

5.      Clayton Daniels, Caught by the Truth of DNA

Daniels and his wife, Misty, decided the best way to fund his run from the law on sexual assault charges was to fake Daniels’ death and collect on the life insurance. Misty helped him to research all the necessary information to perform their deed: how to burn a human body, where to get a human body to burn, and how to get money doing the above. It was believed that part of the $110k in proceeds was to be earmarked for plastic surgery in Mexico for Daniels.

The Daniel’s stole the body of an elderly woman from a nearby cemetery that housed the remains of deceased persons who could not afford burials. They then dressed the body into Daniels’ clothing and put it in a car, which they set on fire. They thought the fire would burn the body beyond recognition, but they had not counted on the insurance company requesting a DNA test of the victim. Misty Daniels was sentenced to twenty years for insurance fraud and an additional ten years for hindering Clayton’s arrest.

6.      Tam Vu Pham, Healthcare Pays Well

Medical clinic administrator Pham, along with various other conspirators in what was called in 2011 “the largest medical fraud prosecution in the country”, was caught up in an intricate medical insurance fraud case. Pham performed the role of administrating the scheme, rounding up doctors, patient recruiters, an attorney, and an accountant to carry out the theft of $154M in fraudulent medical insurance benefits for 2,800 patients who agreed to undergo surgeries they did not need, in exchange for discount cosmetic surgery or cash payments. Pham, as the primary ringleader, received twelve years in prison for the crime.

7.      Candice Lambert, Cancer Survivor Fakes Cancer

Lambert, who was a special education teacher from New Hampshire, taught in New York for eight years. She often wore scarves and caps on her head and told co-workers she lost her hair during rounds with chemotherapy. Lambert filed for permanent disability status and received donations from friends and co-workers. She also received over $20K in insurance benefits.

She then returned to New Hampshire and got another teaching job. A newspaper article ousted her, calling her a hero for continuing to teach despite her cancer diagnosis. Her previous employer notified authorities and Lambert received one to three years in prison for the scam.

8.      Jason Sheedy, No Criminally Artist Mind

Sheedy made successful insurance claims for almost $254K on various expensive pieces of artwork that he claimed were stolen, including work by Rembrandt and Salvador Dali. He would have gotten away with his crime, except he later tried to sell the same pieces at an online auction house, listing himself as the owner.

9.      Carla Patterson, Would You Like a Mouse with Your Soup?

Patterson saw a quick payday in a bowl of vegetable soup at a Cracker Barrel restaurant in Newport News, Virginia. She proclaimed that she found a dead mouse in her soup. When the investigation ensued, it was determined that the mouse had not drowned in the soup because there was no soup in its lungs, and that it had not been cooked in the soup. Patterson entered into a settlement with Cracker Barrel, which resulted in her serving one year in prison, a far cry from the $500K she originally requested for her ordeal.

10.  Tramesha Lashon Fox, Bartered Grades Up in Smoke

Fox, a Texas teacher, offered failing students passing grades for stealing and setting fire to her automobile, on which she owed $20K. The car was about to be repossessed so Fox came up with the idea and her students complied. She was caught and convicted of arson when she purchased a new car before she reported the theft of the previous auto.

11.  Michael Vincent Petronella and Devon Lynn Kile, Working Workers’ Comp

Constantine and Kile submitted fraudulent claims for injured workers who really had no insurance coverage. To add insult to injury, the couple also did not report their payroll or the number of employees they had, correctly. Constantine was sentenced to ten years in prison. Kile agreed to ten years probation and a payment of $3M in restitution.

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