ZIFL- Volume 26, Issue 9 – May 1, 2022
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and at https://zalma.com/blog plus more than 4200 posts.
Posted on May 2, 2022 by Barry Zalma
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Read all of the articles in this Issue including the Following Articles by clicking on ZIFL-05-01-2022.
Dustin Jungvirt, appealed the sentence imposed following his guilty plea to insurance fraud, claiming the district court failed to properly consider which sentencing option would best rehabilitate him. In State of Iowa v. Dustin Jungvirt, No. 21-1130, Court of Appeals of Iowa (April 13, 2022) the Iowa Court of Appeals resolved the dispute.
Insurer Sentenced for Fraud & Bankruptcy Violations
Jacques Andres Frym, 53, who owned businesses in the Savannah area, pleaded guilty last year to lying under oath about his income. Frym at one time owned Federal Employee Benefits LLC, an insurance company, along with real estate and other interests, federal court records show.
Indiana Travel Agent Sentenced for Insurance Fraud
Links to Fraud Bureaus, Fraud Divisions & Anti-Fraud Organizations
Good News From the Coalition Against Insurance Fraud
Health Insurance Fraud Convictions
In one of Dozens: California Chiropractor Sentenced to Five Years in Prison for Fraud.
Susan Poon, a 57-year-old former Orange County, California chiropractor was sentenced to more than 5 years in federal prison for defrauding health insurers out of around $2.2 million as part of a scheme that lasted more than three years.
Nearly a year after she was convicted of health care fraud and aggravated identity theft, among other charges, Poon submitted false reimbursement claims to several health insurance providers that included false diagnoses and claims of services that were not actually performed, as well as fraudulent prescriptions containing fake diagnoses of dependents of Costco and United Parcel Service employees.
To facilitate the fraud, prosecutors said Poon stole the personal identification information of her victims by attending health fairs at various UPS and Costco locations and soliciting the info from employees.
In a sentencing brief filed with the court, prosecutors described a scheme involving “interdependent moving parts” in which Poon “lied about visits with, diagnosis of, and treatments given to actual people and their children.”
During her sentencing hearing, Poon told U.S. District Judge David O. Carter that she was “sincerely sorry” for her mistakes and promised that “for the future I will lead with a moral compass in my soul.” Poon spoke of her family history – which included parents who immigrated to New York with nothing and established a successful restaurant – to her own work helping the hungry and homeless.
“There is not one day since this incident that I am not truly sorry,” Poon told the judge. “I mentally punish myself daily.”
Carter acknowledged what he described as Poon’s “extraordinary” family history, and said that prior to the fraud scheme she appeared to live an “exemplary life.” But the judge also noted that the fraud went on for years and required information taken from more than 500 people, including some toddlers.
“You represent a person I intuitively feel has turned a corner,” Carter said. “By the same token, the harm here is extraordinary.”
The judge ultimately decided on a sentence slightly shorter than the seven years and three months requested by prosecutors. He also ordered her to pay more than $1 million in restitution.
Does the Covenant of Good Faith & Fair Dealing in Canada Restrict Report to Police?
Other Insurance Fraud Convictions
Three Sentenced in Big Insurance Fraud Scheme to Stage Crashes
Keishira Richardson, 27, Chandrika Brown, 31, and Aisha Thompson, 44, are among 36 people convicted so far in what authorities have called “Operation Sideswipe.”
The three Louisiana women have been ordered to repay a total of $5.5 million to companies defrauded in a scheme to stage wrecks.
Each was sentenced on one count each of conspiracy to commit mail fraud.
Richardson was sentenced to five years on probation and ordered to pay $4.7 million in restitution. That’s the total paid to settle claims made by her and others for one crash staged on Oct 13, 2015.
Richardson’s father, Anthony Robinson, and his wife, Audrey Harris, were each sentenced in June to four years in prison on the same charge for that crash. They both underwent extensive medical treatment, neck and back surgeries, because they “understood that agreeing to more medical treatment would increase the value of their lawsuit,” according to a news release about their sentence.
U.S. District Judge Ivan Lemelle, who also sentenced Keishira Robinson, told her father and Harris that they and their codefendants would be responsible for paying $5 million including the companies’ attorneys fees.
U.S. District Judge Sarah S. Vance sentenced Thompson to 18 months in prison and restitution of $677,500 — the total paid in claims to several people involved in a crash with a tour bus on Oct. 15, 2015.
Vance ordered Brown to put in 100 hours community service and pay $121,000 restitution. Although Brown wasn’t in a RAV4 that hit a tractor-trailer on Sept. 6, 2017, she hired a lawyer, put in a claim for injuries and received medical treatment, a news release said.
More reports at ZIFL.
Announcement from the Justice Department re Covid-19 Fraud
New Book on Ethics for the Insurance Professional
Go To Jail, Go Directly to Jail, Do Not Pass Go
Eleventh Circuit Explains How Doctor Defrauded Medicare and Medicaid
Doctor Who Treated Georgia Patients More than 70 hours a Day While he Gambled in Las Vegas Goes to Jail
In United States of America v. Douglas Moss, Nos. 19-14548, 19-14565, United States Court of Appeals, Eleventh Circuit (April 12, 2022) the Eleventh Circuit affirmed the conviction, sentence, restitution and forfeiture of millions taken in his crime.
EXPLANATION OF MEDICARE AND MEDICAID SYSTEM
Medicare and Medicaid combined spend $1,500,000,000,000 a year, which is more than one-third of the total health expenditures in this country. Like other government health care programs, these two work on the honor system. Trust and more trust. Both programs take a pay first, ask questions later (if ever) approach. Which leads to crime and more crime, both sooner and later.
A trust-based system is only as good as the people who are trusted. Douglas Moss is one of those who was trusted but not trustworthy. As a physician, he fraudulently billed Medicare and Medicaid for millions of dollars for visits to nursing home patients that he never made.
For his fraudulent conduct, Moss was convicted of conspiracy and substantive health care fraud, sentenced to 97 months imprisonment, ordered to pay restitution of about 2.2 million dollars, and ordered to forfeit around 2.5 million dollars. He, of course, appealed, using the funds he stole to pay lawyers to challenge the convictions, sentence, restitution amount, and forfeiture amount, which is nearly every component of the judgment against him.
FACTUAL BACKGROUND
To explain Moss’ crimes the Eleventh Circuit began its analysis with how Medicare and Medicaid determine how much health care providers will be paid. It explained that Medicare and Medicaid are federally funded health care programs. Medicare pays “claims,” which are requests by a health care provider to be “reimbursed” (paid) for services provided to Medicare recipients. It also contains a code for the procedure or service performed.
The “CPT codes,” which stands for Current Procedural Terminology codes are a national uniform coding structure created for use in billing and overseen by the American Medical Association. They are used by all health insurance companies and by Medicare and Medicaid. A code represents at least two things: the procedure or service performed and the level of complexity involved in it. One type of procedure or service can have more than one CPT code because the same procedure may, in some cases, be more complex than in others. Generally, for any given category of procedure, the more complex the performance, the higher the number used for its code. In turn, a higher CPT code generally gets a higher reimbursement amount from Medicare.
Most of the fraud in this case involves claims for visits to nursing homes. For Medicare to pay a claim several requirements must be met. The service must be provided to a real patient who is properly enrolled as a Medicare beneficiary; it must be provided by a health care provider properly licensed and “enrolled” as a Medicare provider; it must be a service covered by Medicare; and it must be properly documented and billed. The service also must be reasonable and medically necessary. Health care providers sign a “certification statement” agreeing that they will comply with all of those requirements and will not submit false claims.
To properly bill Medicare at the physician’s rate for services provided in a nursing home setting, the physician must be the one in the patient’s room directly providing the service to the patient. When an assistant performs the service, the claim submitted to Medicare must disclose that fact.
Given Moss’ failure to identify a single properly billed claim, he did not persuade the appellate court that the district court clearly erred.
ZIFL OPINION
The Eleventh Circuit admitted that, because Medicare and Medicaid payments are made on the “honor system” it is wide open to fraud perpetrated by health care professionals with no honor. Moss was a provider with no honor. That the scheme succeeded for many years is because the system believes all of the health care professional are honorable and just paid Moss what he asked even when a simple calculation would have shown that that he was billing for 70 hours of service in a single day. Moss made a great deal of dishonest money only to complain that he was not allowed to keep the fruits of his crime and as a kind and professional doctor was now required to practice medicine in the federal gray bar hotel – the federal prison. Hopefully this will deter other doctors from trying to emulate his crime.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected].
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Convicted Criminal Seeks to Compel Receiver to Protect his Assets
Post number 5291
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The Work of a Court Appointed Receiver is Constitutionally Protected
In Simon Semaan et al. v. Robert P. Mosier et al., G064385, California Court of Appeals, Fourth District, Third Division (February 6, 2026) the Court of Appeals applied the California anti-SLAPP statute which protects defendants from meritless lawsuits arising from constitutionally protected activities, including those performed in official capacities. The court also considered the doctrine of quasi-judicial immunity, which shields court-appointed receivers from liability for discretionary acts performed within their official duties.
Facts
In September 2021, the State of California filed felony charges against Simon Semaan, alleging violations of Insurance Code section 11760(a) for making...
When There are Two Different Other Insurance Clauses They Eliminate Each Other and Both Insurers Owe Indemnity Equally
Post number 5289
In Great West Casualty Co. v. Nationwide Agribusiness Insurance Co., and Conserv FS, Inc., and Timothy A. Brennan, as Administrator of the Estate of Pat- rick J. Brennan, deceased, Nos. 24-1258, 24-1259, United States Court of Appeals, Seventh Circuit (February 11, 2026) the USCA was required to resolve a dispute that arose when a tractor-trailer operated by Robert D. Fisher (agent of Deerpass Farms Trucking, LLC-II) was involved in a side-impact collision with an SUV driven by Patrick J. Brennan, resulting in Brennan’s death.
Facts
Deerpass Trucking, an interstate motor carrier, leased the tractor from Deerpass Farms Services, LLC, and hauled cargo for Conserv FS, Inc. under a trailer interchange agreement. The tractor was insured by Great West Casualty Company with a $1 million policy limit, while the trailer was insured by Nationwide Agribusiness Insurance Company with a $2 million ...
Opiod Producer Seeks Indemnity from CGL Insurers
Post number 5288
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Insurers Exclude Damages Due to Insured’s Products
In Matthew Dundon, As The Trustee Of The Endo General Unsecured Creditors’ Trust v. ACE Property And Casualty Insurance Company, et al., Civil Action No. 24-4221, United States District Court, E.D. Pennsylvania (February 10, 2026) Matthew Dundon, trustee of the Endo General Unsecured Creditors’ Trust, sued multiple commercial general liability (CGL) insurers for coverage of opioid-related litigation involving Endo International PLC a pharmaceutical manufacturer.
KEY FACTS
Beginning as early as 2014, thousands of opioid suits were filed by governments, third parties, and individuals alleging harms tied to opioid manufacturing and marketing.
Bankruptcy & Settlements
Endo filed Chapter 11 in August 2022; before bankruptcy it ...
Passover for Americans
Posted on February 19, 2026 by Barry Zalma
“The Passover Seder For Americans”
For more than 3,000 years Jewish fathers have told the story of the Exodus of the enslaved Jews from Egypt. Telling the story has been required of all Jewish fathers. Americans, who have lived in North America for more than 300 years have become Americans and many have lost the ability to read, write and understand the Hebrew language in which the story of Passover was first told in the Torah. Passover is one of the many holidays Jewish People celebrate to help them remember the importance of G_d in their lives. We see the animals, the oceans, the rivers, the mountains, the rain, sun, the planets, the stars, and the people and wonder how did all these wonderful things come into being. Jews believe the force we call G_d created the entire universe and everything in it. Jews feel G_d is all seeing and knowing and although we can’t see Him, He is everywhere and in everyone.We understand...
Passover for Americans
Posted on February 19, 2026 by Barry Zalma
Read the full article at https://www.linkedin.com/pulse/passover-americans-barry-zalma-esq-cfe-5vgkc.
“The Passover Seder For Americans”
For more than 3,000 years Jewish fathers have told the story of the Exodus of the enslaved Jews from Egypt. Telling the story has been required of all Jewish fathers. Americans, who have lived in North America for more than 300 years have become Americans and many have lostthe ability to read, write and understand the Hebrew language in which the story of Passover was first told in the Torah.
Passover is one of the many holidays Jewish People celebrate to help them remember the importance of G_d in their lives. We see the animals, the oceans, the rivers, the mountains, the rain, sun, the planets, the stars, and the people and ...
You Get What You Pay For – Less Coverage Means Lower Premium
Post number 5275
Posted on January 30, 2026 by Barry Zalma
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When Experts for Both Sides Agree That Two Causes Concur to Cause a Wall to Collapse Exclusion Applies
In Lido Hospitality, Inc. v. AIX Specialty Insurance Company, No. 1-24-1465, 2026 IL App (1st) 241465-U, Court of Appeals of Illinois (January 27, 2026) resolved the effect of an anti-concurrent cause exclusion to a loss with more than one cause.
Facts and Background
Lido Hospitality, Inc. operates the Lido Motel in Franklin Park, Illinois. In November 2020, a windstorm caused one of the motel’s brick veneer walls to collapse. At the time, Lido was insured under a policy issued by AIX Specialty Insurance Company which provided coverage for windstorm damage. However, the policy contained an exclusion for any loss or damage directly or indirectly resulting from ...
