Am I In Trouble?
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Bankruptcy Fraud Defeats Legitimate Insurance Claim
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Insurance fraud, like any other profession, improves with practice. The beginner, unaware of the tools available to an insurer, makes a stupid error that will destroy him or her.
Abraham MacPherson was an insurance fraud novice. He had succeeded, with ease, in defrauding his bank by submitting a false financial statement as part of the application for a loan. He even convinced an FBI Agent, checking his fraudulent loan application, that he was the victim of a dishonest loan broker. Success made Abraham bold. He decided it was time to branch out into insurance fraud.
The Petition for bankruptcy, like most filed in the Bankruptcy court showed MacPherson to have no equity in any of his property and no money. He reported his assets as only $500 in jewelry and the tools of his plumbing trade since they were exempt from the grasp of his creditors. What he did not tell the Bankruptcy Court was that MacPherson also owned a $150,000 twin engine Cessna Aircraft that he used to go on hunting and ski trips. He did not tell his lawyer about the airplane because he did not want it sold for the benefit of the judgment creditor whom he felt cheated him.
The day his debts were discharged Abraham called his insurance broker. He advised the broker that his home had been burglarized. He claimed the burglars took all of the jewelry on the schedule. He demanded the immediate issuance of a check for $41,960.
MacPherson stuck to his story. He demanded immediate payment or he would complain to the California Department of Insurance and file suit.
Moseby reported to his principal, the insurer, who decided to deny the claim for fraud. Further, following the law, since MacPherson had admitted to Bankruptcy fraud, the insurer instructed Moseby to pass the information he had obtained to the FBI. In addition, as required by California law he presented the information to the California Department of Insurance, Fraud Division.
Moseby was right, MacPherson was not in trouble with him. He simply would not collect on his claim. MacPherson was in serious trouble with the FBI and the U.S. Department of Justice.
The Special Agent of the Federal Bureau of Investigation was upset that MacPherson had fooled him. After verifying the results of Moseby’s investigation the FBI presented the information to a U.S. Attorney. Prosecution followed charging MacPherson with Bankruptcy Fraud, Mail Fraud — for the presentation of a false and fraudulent claim to an insurer by use of the U.S. Postal Service — and for loan fraud.
He went to trial in U.S. District Court in Sacramento on charges of Bankruptcy fraud. The trial took five hours to complete and the jury was instructed on the law at 4:00 p.m. They deliberated for three days and convicted MacPherson, who was sentenced to serve three years in federal prison.
ZALMA OPINION
It doesn’t pay to lie to an insurance company about a claim. Doing so can lose your claim. It is worse to lie to a bankruptcy court because that is a federal crime that could put the liar in jail for as much as five years. This case proves why it is best to always tell the truth.
(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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Arsonist Tried To Represent Himself, Failed, and Sought Habeas Relief
Post number 5357
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Karacson’s Arson for Profit Attempt Required Skill & Experience to Succeed
In Steve Ellis Karacson v. David Shaver, Warden, No. 25-1089, United States Court of Appeals, Sixth Circuit (May 20, 2026) Steve Karacson was convicted in Michigan state court of arson and insurance fraud after evidence showed he burned his own insured home. Investigators found multiple points of origin, gasoline odor, and evidence tying him to the scene, including cell-phone location data and a receipt showing he had purchased a gas can and gloves shortly before the fire.
FACTS
Karacson initially had appointed counsel, but his relationships with both appointed attorneys ...
Foolish to Repeatedly Disobey Court Orders
All That Remains For Trial Is Plaintiff’s Damages On Each Of These Claims And Establishing Proximate Causation Of Those Damages.
Post number 5348
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In Linh Wang v. Esurance Insurance Company, No. C24-0447-JCC, United States District Court, W.D. Washington, Seattle (May 1, 2026) John C. Coughenour, United States District Judge, found that throughout this case, culminating with its briefing on Plaintiff’s renewed motion and that Defendant has subjected Plaintiff to unnecessary motion practice for clearly discoverable information and made dubious representations (including to the Court).
FACTUAL BACKGROUND
This case involves an underinsured/uninsured motorist insurance bad faith claim arising from a 2017 motor vehicle collision. The plaintiff, Linh Wang, alleges that Esurance Insurance ...
The Right to Negotiate with Insurer is Not an Assignment of Claims
Post number 5347
Read the full article at https://www.linkedin.com/pulse/ambiguous-contract-repair-assignment-barry-zalma-esq-cfe-2xppc, see the full video at https://rumble.com/v79is1s-ambiguous-contract-to-repair-not-an-assignment.html and at and at https://zalma.com/blog plus more than 5300 posts.
Nebraska Requires an Actual Assignment to Allow Contractor to Sue Insurer
In Millard Gutter Company, a corporation doing business as Millard Roofing and Gutter v. Farmers Mutual Insurance Company of Nebraska, also known as Farmers Mutual Insurance, also known as Farmers Mutual, No. A-24-818, Court of Appeals of Nebraska (May 5, 2026) Millard sued Farmers as an assignee of Jane Anzalone who had hired Millard Gutter to repair the roof of her home and agreed to allow Millard Gutter to coordinate with her insurer, Farmers Mutual, concerning reimbursement for repairs authorized under her insurance policy.
FACTUAL BACKGROUND
In ...
Qui Tam Case Without Evidence to Prove Fraud Fails
Post number 5369
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In People Of The State Of California Ex Rel. Heath & Yuen, APC v. Silver Bird Auto Leasing, LLC et al., B342847, California Court of Appeals, Second District, Eighth Division (June 5, 2026) Heath & Yuen, APC defended parties in an automobile collision case involving a McLaren and a tour van. After that case settled for $25,000, the firm filed a qui tam action under California’s Insurance Frauds Prevention Act (IFPA) against Silver Bird Auto Leasing, LLC, X-Law Group, PC, and Filippo Marchino. The firm alleged three fraudulent acts in the underlying litigation:
1. the complaint falsely stated the McLaren was making a “legal turn,”
2. respondents produced a fraudulent repair bill/estimate, and
3. respondents failed to disclose Marchino’s GEICO insurance and its payment for repairs....
Full Faith and Credit Act Controlled
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Posted on June 9, 2026 by Barry Zalma
Post number 5368
Posted on June 9, 2026 by Barry Zalma
In Prime Insurance Company, Inc. v. Medicab Transportation, LLC, Jason Rhodes, and Dale Johnson v. Prime Insurance Company, Inc and Prime Property & Casualty Insurance, Inc. No. 2:24-cv-421-SPC-KRH, United States District Court, M.D. Florida, Fort Myers Division (June 3, 2026) Medicab, a paratransit company, bought two policies in 2021: a Business Auto Policy from PPCI and a Commercial Liability Policy from Prime. Both policies, as originally written, appeared to cover injuries arising from loading and unloading patients from Medicab vans.
After a patient, Margaret St. Aubin, fell while being unloaded from a van and suffered injuries, her Estate made a $1 million demand. Prime and its claims administrator concluded that the Commercial Policy’s loading/unloading language had been included by mutual mistake, because...
Full Faith and Credit Act Controlled
Read the full article at https://lnkd.in/evHXiiFE and at https://zalma.com/blog.
Posted on June 9, 2026 by Barry Zalma
Post number 5368
Posted on June 9, 2026 by Barry Zalma
In Prime Insurance Company, Inc. v. Medicab Transportation, LLC, Jason Rhodes, and Dale Johnson v. Prime Insurance Company, Inc and Prime Property & Casualty Insurance, Inc. No. 2:24-cv-421-SPC-KRH, United States District Court, M.D. Florida, Fort Myers Division (June 3, 2026) Medicab, a paratransit company, bought two policies in 2021: a Business Auto Policy from PPCI and a Commercial Liability Policy from Prime. Both policies, as originally written, appeared to cover injuries arising from loading and unloading patients from Medicab vans.
After a patient, Margaret St. Aubin, fell while being unloaded from a van and suffered injuries, her Estate made a $1 million demand. Prime and its claims administrator concluded that the Commercial Policy’s loading/unloading language had been included by mutual mistake, because...
