New Jersey Attorney General dedicates resources to investigating and prosecuting insurance fraud to stabilize insurance rates in New Jersey

September 24, 2004

By Peter C. Harvey - Attorney General - New Jersey (View author info)

A PRESS RELEASE

Insurance Fraud Investigation Targeting Fake Police Reports & Insurance Claims Results In Indictment Of 39 Persons...

Insurance Fraud Investigation Targeted Former E. Orange Police Officer and 70+ Others For Their Role In the Scam... Over $900,000 In Fake Insurance Claims Submitted Over Course of Five Years...

Attorney General Peter C. Harvey announced that the Division of Criminal Justice - Office of Insurance Fraud Prosecutor has obtained criminal indictments against 39 individuals from the Essex County area on charges they participated in an extensive insurance fraud scheme designed to collect tens of thousands of dollars by filing bogus insurance claims based on fake police reports. The extensive insurance fraud scam was headed by a former East Orange police officer and included a corrupt lawyer and dozens of individuals acting either as "runners" or "injured" accident victims.

Attorney General Harvey said that the multi-year investigation and prosecution of what has become known as the "Phillip Major" case resulted in the enactment of New Jersey's "runners" law which criminalized the use of individuals employed or paid by medical professionals or lawyers to recruit people to submit fraudulent insurance claims, The case also secured New Jersey's Office of Insurance Fraud Prosecutor as a national leader in prosecuting insurance fraud cases.

Harvey noted that a study by the Washington, D.C.-based Coalition Against Insurance Fraud reported that New Jersey's Office of Insurance Fraud Prosecutor was first in the nation in the total number of new insurance fraud cases opened in 2002 – criminal and civil. In 2003, the Office of Insurance Fraud Prosecutor continued to attack insurance fraud by charging 240 defendants via 118 criminal indictments and 97 criminal accusations. Additionally, 5,524 civil sanctions were filed which resulted in more than $16 million in fines, penalties and restitution.

"Insurance fraud is among our top priorities," said Attorney General Harvey. "We have dedicated significant resources to investigating and prosecuting insurance fraud to stabilize insurance rates in New Jersey. We're fighting insurance fraud on three fronts: criminal prosecution, civil sanctions and forfeiture of the licenses of professionals who engage in insurance fraud. We've used that triple threat to make our Office of Insurance Fraud Prosecutor one of the nation's foremost fraud fighting agencies."

According to Vaughn L. McKoy, Director,. Division of Criminal Justice and Insurance Fraud Prosecutor Greta Gooden Brown, the 39 defendants were charged in four separate State Grand Jury indictments with second degree conspiracy to commit official misconduct and theft by deception. A second degree crime carries a maximum penalty of up to ten years in state prison and a fine of up to $150,000. Additionally, the defendants face possible civil insurance fraud fines pursuant to the Insurance Fraud Prevention Act. (A list of the defendants charged in the State Grand Jury indictments is attached.)

Director McKoy said the indictments allege that from June, 1995 through October, 1999, the 39 individuals participated in the wide-ranging and extensive insurance fraud scheme by agreeing to file false police reports stating that they had been involved in automobile accidents when, in fact, they had not been involved in any motor vehicle accidents. The fraudulent police accidents reports were written by former East Orange Police Officer Philip Major during 19955 and 1996. The indictments charge that at more than a dozen fake automobile accident reports were prepared and used to support fraudulent automobile insurance Personal Injury Protection (PIP) and bodily injury claims submitted to various insurance companies. It is charged that by falsifying police reports and submitting the fake reports to the insurance companies, the scheme attempted to obtain more than $900,000 in payments for purported medical treatments and personal injury claims.

Insurance Fraud Prosecutor Gooden Brown noted that more than 20 individuals, including a former police officer and a lawyer, along with other participants, have been prosecuted for their roles in the insurance fraud scam. The principal defendant was previously identified as Phillip Major, 37, Maplewood, Essex County. Major, a former East Orange police officer and admitted "runner," pled guilty to conspiracy and two counts of official misconduct on Sept. 29, 1999 before Essex County Superior Court Judge Joseph A. Falcone.

In pleading guilty, Major admitted that he prepared 16 false police automobile accident reports so that approximately 60 insurance claims could be submitted to insurance companies for Personal Injury Protection (PIP), property damage, and non-economic losses arising from bodily injuries purportedly sustained in the automobile accidents. Major also admitted that he attempted to bribe another police officer for additional police accident report information in order to recruit patients to submit insurance claims. Major is scheduled to be sentenced by Essex County Superior Court Judge Donald J. Volkert on Dec. 10, 2004.

As part of the investigation, Mark Bendet, a now-disbarred attorney who formerly practiced law in Passaic County, was sentenced to 13 years in state prison after pleading guilty to charges of conspiracy and bribery. In pleading guilty on May 16, 2001, Bendet admitted that he, his estranged wife Imelda Toquero, and Major, paid bribe money for police automobile accident reports in order to submit fraudulent Personal Injury Protection (PIP) claims to various insurance companies. On March 2, 2001, Toquero pleaded guilty, admitting that she paid Major for police reports. Toquero was sentenced on Aug. 16, 2001 to 364 days in county jail.

The indictment was handed up to Mercer County Superior Court Judge Neil Shuster on Sept. 21. The case will be assigned to the Essex County Superior Court for trial. The defendants will be ordered to appear in Court for arraignment and bail.

The investigation was conducted by the Division of Criminal Justice - Office of Insurance Fraud Prosecutor which investigates and prosecutes civil and criminal insurance fraud cases. Deputy Attorney General Andrew C. Fried and Supervising State Investigator Edward Buttimore co-ordinated the long-term investigation. DAG Fried represented the Division of Criminal Justice - Office of Insurance Fraud Prosecutor before the State Grand Jury.

The Office of Insurance Fraud Prosecutor is committed protecting New Jerseyans from unscrupulous acts by combating all forms of insurance fraud," said Insurance Fraud Prosecutor Gooden Brown. "It is particularly disturbing when sworn police officers and professionals violate the public trust by participating in insurance fraud schemes. This indictment demonstrates our resolve to vigorously investigate and prosecute cases of this nature."

An indictment is merely an accusation. The defendants are presumed innocent of the charges unless and until proven guilty beyond a reasonable doubt in a Court of law.


# # #


DEFENDANT (AGE, ADDRESS) CHARGES

Miguel Sanchez 36 31 Center St. Jamaica Plain Boston, MA
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Romona Mora Silvero 33 Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Bienviendo Sanchez 39 317 Park Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Enercida Noboa 43 317 Park Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Jose Noboa 40 317 Park Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Ron West 46 336 Clinton Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Ken Kennedy 36 332 Park Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Maurice Young 48 98 No. 22nd St. East Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Barry Hill 46 152 Pomona Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Sharon Timmons 35 Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Xavier English 35 Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Jerry St. Louis 40 Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

James Saint Jean 41 400 Roseville, Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Guy Longechamp 35 18 Grove Pl. East Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Davon Charisma 40 152 N. 9th St. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

"Papo"/Gualberto Juan Unknown Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Audrey Lopez 31 285 North 7th St. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Ana Baretto 52 Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Victor Medina 28 222 Verona Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Jose D. Frias 35 328 Bloomfield Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Brunilda Blanco 45 364 White St. Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Cari S. Blanco 26 500 Roseville Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Nieves Carasco 42 4907 El Dorado Dr. Tampa, FL
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Juan F. Frias 41 350 Park Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Felix R. Frias 37 108 Lincoln Ave. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Rafael Torres 43 364 White St. Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Richard Morales 27 New Jersey State Prison
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Cordell Vaxter 38 200 Fabyan Pl. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Lawrence W. Hannah 32 61 Elmwood Ave. Montclair, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Katrina Campbell 31 570 D-Capobianco Plaza Rahway, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Selena Brown 32 Rahway, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Ronald J. Kelly 37 526 Rosewood Terr. Linden, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Mark Boyette Unknown Unknown
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Linc Palmer 41 66 Hughes St.Maplewood, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Darrick S. Farmer 74 210 No. 4th St. Newark, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Beverly Carter 47 50 So. Arlington Ave. East Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Ron Bagley 45 358 Park Ave. East Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Barbara Little 52 103 Cambridge Circle Murrell Inlet, SC
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree

Janice Smart 41 31-F Sussex Ave. East Orange, NJ
Conspiracy to Commit Official Misconduct and Theft by Deception - 2nd Degree