Fraudsters Must Pay RICO Damages
Post 5192
Allstate Fights Fraudsters in Court and Wins
Read the full article at https://lnkd.in/gNU_Xim7, See the full video at https://lnkd.in/gDZThRCJ and at https://lnkd.in/gd4xv-wC, and at https://zalma.com/blog.
Fraudsters Must Pay RICO Damages
Post 5192
In Allstate Insurance Company, et al v. Vladimir Geykhman, et al., No. 24 CV 4580 (PKC) (CLP), United States District Court, E.D. New York (September 7, 2025) Allstate Insurance Company, et al (together “plaintiffs” or “Allstate”), sued seeking damages that they suffered from an insurance fraud scheme where defendants billed Allstate for medically unnecessary physical therapy services and collected insurance payments on fraudulent No-Fault claims.
Allstate accused several people of participating in an insurance fraud scheme. The scheme involved billing Allstate for medically unnecessary physical therapy services into three groups:
1. Licensed physical therapists.
2. Non-licensed laypersons who controlled the No-Fault clinics and the medical providers they staffed.
3. The operation of the clinics by unlicensed individuals, and the involvement in unlawful referral and kickback arrangements.
BACKGROUND
Defaulting Defendants carried out a scheme to exploit New York’s No-Fault insurance laws, which provide for insurance coverage to claimants involved in automobile accidents. As the victim of the scheme, Allstate alleged that it was fraudulently billed for coverage for physical therapy services.
These clinics operated in several locations in the New York area and were implicated in one of the largest no-fault insurance frauds in New York history.
The second category of defendants consists of licensed physical therapists that nominally owned the PC Defendants.
DISCUSSION
Default Judgment
The burden is on the plaintiff to establish his entitlement to recovery. The Court found that all three factors permit entry of default judgment against the Defaulting Defendants and respectfully recommends that they be deemed to have defaulted.
Substantive RICO Claims
Allstate alleges eight substantive RICO Claims that correspond with the fraudulently incorporated professional corporations that make up the PC Defendants. These RICO claims are alleged against all Defaulting Defendants, grouped by the different PC Defendant enterprises, and Geykhman, for his role as a Management Defendant in control of the PC Defendants.
To sustain a RICO claim under 18 U.S.C. § 1962(c), a plaintiff must show ‘(1) that the defendant (2) through the commission of two or more acts (3) constituting a ‘pattern’ (4) of ‘racketeering activity’ (5) directly or indirectly invests in, or maintains and interest in, or participates in (6) an ‘enterprise’ (7) the activities of which affect interstate or foreign commerce.
The RICO Enterprises
There are eight RICO enterprises at issue in Allstate’s motions for default judgment, each corresponding with a PC Defendant currently in default. Allstate has successfully pleaded that the PC Defendant enterprises are “enterprises” and that the other Defaulting Defendants and Geykhman are “persons” under RICO.
State Common Law Fraud
Allstate moved for default judgment on the state common law fraud claims it brings against each defendant in this action. Allstate has established that Defaulting Defendants and Geykhman have made material misrepresentations or omissions of fact, that they made these material misrepresentations with knowledge of their falsity and with intent to defraud, and that Allstate’s reasonable reliance on these representations led it to suffer damages.
Default Judgment should be granted as to Allstate’s RICO claims.
ZALMA OPINION
Insurance fraud costs the insurance buying public over $308 billion every year. Insurers, like Allstate, are now fighting back by taking the profit out of the crime. In this case, Allstate will get money judgments against the doctors, chiropractors, health care providers for the money obtained by fraud and multiple extra damages under the RICO laws. They will probably have a difficult time collecting but they must do as much as they can to collect from the fraudsters.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Post 5203
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In an insurance dispute following damage caused by Hurricane Ida to Vina Cleaners’ property. Vina Cleaners was insured under a commercial policy with the Defendant, Ohio Security Insurance Company. Vina Cleaners assigned its rights ...
Willful and Malicious Injury by the Debtor to Another Entity is Nondischargeable
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Post 5202
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In In re Niko T. Irizarry, Mark Riley v. Niko T. Irizarry, No. 2:24-bk-01261-FMD, Adv. No. 2:24-ap-00035-FMD, United States Bankruptcy Court, M.D. Florida, Fort Myers Division (September 30, 2025) established that fraudulent conduct is not dischargeable in Bankruptcy.
Background and Allegations:
Plaintiff Mark Riley filed a lawsuit against Defendant Niko Irizarry in federal district court, alleging claims for civil conspiracy under 42 U.S.C. § 1983, malicious prosecution, violation of his Fourteenth Amendment rights, common law false imprisonment or arrest, and intentional infliction of emotional distress. Riley’s claims are based on allegations with...
Claim Insurer Defrauded Insured Needs Evidentiary Allegations
Post 5201
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It Doesn’t Pay to Accuse an Insurer of Fraud Without Evidence
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Case Background:
Plaintiff Yarisleidy Suarez Rodriguez (the Insured) filed a claim for underinsured motorist (UIM) benefits with Defendant Safeco Insurance Company of Illinois, which was denied. Rodriguez alleged that her policy included UIM coverage, which Safeco fraudulently removed without her knowledge.
Legal ...
How a Need for Profit Led Health Care Providers to Crime
Post 5185
Posted on September 8, 2025 by Barry Zalma
See the full video at https://lnkd.in/gePN7rjm and at https://lnkd.in/gzPwr-9q
This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers.
The Dishonest Chiropractor/Physician
How a Need for Profit Led Health Care Providers to Crime
See the full video at and at
This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
How Elderly Doctors Fund their ...
How a Need for Profit Led Health Care Providers to Crime
Post 5185
Posted on September 8, 2025 by Barry Zalma
See the full video at https://lnkd.in/gePN7rjm and at https://lnkd.in/gzPwr-9q
This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers.
The Dishonest Chiropractor/Physician
How a Need for Profit Led Health Care Providers to Crime
See the full video at and at
This is a Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
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Barry Zalma: Insurance Claims Expert Witness
Posted on September 3, 2025 by Barry Zalma
The Need for a Claims Handling Expert to Defend or Prove a Tort of Bad Faith Suit
© 2025 Barry Zalma, Esq., CFE
When I finished my three year enlistment in the US Army as a Special Agent of US Army Intelligence in 1967, I sought employment where I could use the investigative skills I learned in the Army. After some searching I was hired as a claims trainee by the Fireman’s Fund American Insurance Company. For five years, while attending law school at night while working full time as an insurance adjuster I became familiar with every aspect of the commercial insurance industry.
On January 2, 1972 I was admitted to the California Bar. I practiced law, specializing in insurance claims, insurance coverage and defense of claims against people insured and defense of insurance companies sued for breach of contract and breach of the implied covenant of good faith and fair dealing. After 45 years as an active lawyer, I asked that my license to practice law be declared inactive ...
