Don’t Sweat the Small Fraud
Post 5194
See the full video at https://lnkd.in/gkEJm3qy and at https://lnkd.in/gkiZASeT, and at https://zalma.com/blog, plus more than 5150 posts.
"Barry Zalma, Esq., CFE presents blog posts and videos so you can learn how insurance fraud is perpetrated and what is necessary to deter or defeat insurance fraud. This Video Blog of a True Crime Story of Insurance Fraud with the names and places changed to protect the guilty is based upon investigations conducted by me and fictionalized to create a learning environment for claims personnel, SIU investigators, insurers, police, and lawyers better understand insurance fraud and weapons that can be used to deter or defeat a fraudulent insurance claim."
The Accidental Creation of an Insurance Fraudster
The claimant wore plastic framed eye-glasses with thick lenses. He literally fell into a life of insurance crime and fraud.
One day the claimant was walking past a fine restaurant when he fell and broke the frames of his glasses. The manager saw him fall. She rushed out, helped him to his feet and checked his physical condition. He thought he was uninjured but the frames of his glasses had broken at the bridge.
The restaurant manager, fearful of a lawsuit, offered him lunch on the house and asked the cost of the frames. When he told her $80.00, she went to the register and brought him four crisp twenty-dollar bills. The claimant could not believe his good fortune. It was so easy. From that day on he made a good living from many small frauds.
His method was simple and unique at the time. No particular individual was severely harmed by his fraud. Wherever he went he carried with him the broken pair of eye glasses. He would walk into a restaurant in an area far from where he lived. He would hold his broken glasses in one hand and walk up to the cashier squinting. He would say:
“I tripped over your carpet, fell and broke the frames on my glasses. They cost $80.”
One of two things would always happen:
1 A manager of the restaurant would take four twenty dollar bills out of the cash register, apologize, buy the claimant lunch and send him on his way; or
2 the manager took a formal report for the restaurant’s insurance company.
In either event the claimant would profess he only wanted replacement of his glasses. He told the Manager or the adjuster for the restaurant’s insurance company that he would forget any possible personal injuries he may have suffered.
If they did not pay him on the spot, an insurance adjuster would issue a check instantly. No adjuster would take a chance on a lawsuit if he could settle a claim for $80.00.
The claimant would stop and collect his $80 in five to seven restaurants a day. He would seldom buy a meal. He would also, on a small portable typewriter, write letters to various restaurants and other businesses whose names and addresses he got from the telephone book. He would write simply: “I tripped and fell in your lobby and broke the frames of my glasses. Enclosed is the bill from my doctor for replacement. Please send me your check for $80.”
He would send out twenty such letters a day to businesses at random. At least five would merely send him an $80 check in the return mail.
With his earnings, all of which were tax free, the claimant bought a three-bedroom condominium on the west side of town. He furnished the condo with fine furniture, original art and a few antiques. Soon he was driving a new Tesla all electric roadster.
He eventually bought a word processor. He used it with a mailing list he purchased from a credit card company of all its vendors to send out mass mailings of his $80 demand. On good days he would receive ten to twenty $80 checks from varying businesses.
He quickly used up the businesses in his community. He sold the condominium and bought a motor home. He moved from city to city staying in no location more than sixty days.
He would still be doing this multiple fraud if he had learned to spell. His letters always misspelled the word “frames” as “frams.” This misspelling lent a certain amount of credibility to the claims he was presenting. However, one bright adjuster about to write his fifth check for broken glasses “frams” remembered that the four other claimants that he had paid (with different names) misspelled “frames” the same way. He refused to pay.
He reported the scheme to the local police and the insurance fraud bureau. Neither showed any interest in such a petty theft. They refused to prosecute. They even refused to investigate to determine whether they should prosecute. The reported fraud was just too small to expend the effort and funds to investigate.
The claimant left that city quickly. Unfortunately, the claimant’s Achilles heel cut into his profits. The adjuster spread the word to all the adjusters he knew, put out an alert on LinkedIn and several insurance and investigation discussion groups to watch out for the broken “frams.” The claimant’s cash flow from insurers dwindled.
Somewhere in North Dakota or Kansas the claimant is still making a healthy living by reporting to honest business people that he has broken the frames on his glasses.
Eighty dollars seems a small amount to avoid a lawsuit. The claimant, with multiple eighty-dollar claims, would average, in the two months he would limit himself to in any community, $2500 a day. His collections were either in person or by mail. He almost never bought a meal.
He was small stuff and no one wanted to bother with. Yet he stole, in his own small way, more than $600,000 a year. He took long vacations from his job. He stayed in the best resorts. He lived the good life because an $80 fraud is just too small to bother businesses, insurers, police and fraud investigators.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/account/content?type=all; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the InsuranceClaims Library – https://lnkd.in/gwEYk.
Policy Limits Demand Accepted Settles Claim
Post 5434
Posted on August 26, 2026 by Barry Zalma
See the full video at https://lnkd.in/g-ZtsSgK and at https://lnkd.in/ghMBdYWR
A Contingent Offer Accepted Ends the Dispute
In Farmers Insurance Exchange, a California Reciprocal Insurance Exchange, The Superior Court For The County Of San Bernardino, Kathleen Ann Wood, E087128, California Court of Appeals, (July 9, 2026) Farmers Insurance Exchange insured Doyle Archer under an automobile policy with bodily injury limits of $15,000 per person and $30,000 per accident.
FACTUAL BACKGROUND
Archer rear-ended Kathleen Ann Wood at a red light, causing Wood to assert a bodily injury claim against him. Wood’s counsel sent Farmers a pre-litigation settlement demand offering to resolve Wood’s claim for the available policy limits, stating that if the $100,000 demand exceeded the policy, the offer was for the policy limits.
Farmers timely responded in writing, agreed to pay Wood the $15,000 per-person policy limit, and provided the requested ...
Policy Limits Demand Accepted Settles Claim
Post 5434
Posted on August 26, 2026 by Barry Zalma
See the full video at https://lnkd.in/g-ZtsSgK and at https://lnkd.in/ghMBdYWR
A Contingent Offer Accepted Ends the Dispute
In Farmers Insurance Exchange, a California Reciprocal Insurance Exchange, The Superior Court For The County Of San Bernardino, Kathleen Ann Wood, E087128, California Court of Appeals, (July 9, 2026) Farmers Insurance Exchange insured Doyle Archer under an automobile policy with bodily injury limits of $15,000 per person and $30,000 per accident.
FACTUAL BACKGROUND
Archer rear-ended Kathleen Ann Wood at a red light, causing Wood to assert a bodily injury claim against him. Wood’s counsel sent Farmers a pre-litigation settlement demand offering to resolve Wood’s claim for the available policy limits, stating that if the $100,000 demand exceeded the policy, the offer was for the policy limits.
Farmers timely responded in writing, agreed to pay Wood the $15,000 per-person policy limit, and provided the requested ...
The Largest Residential Burglary of All Time
Post 5407
Fraud & the Fear of Bad Faith Suits
Posted on July 22, 2026 by Barry Zalma
See the full video at https://lnkd.in/gWQQEySW and at https://lnkd.in/gyhdK6wv
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection 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.
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection 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.
After ...
Referral of Claims to its SIU Is Not Bad Faith
Post 5487
Posted on September 10, 2026 by Barry Zalma
In WIZ Collision, LLC, on behalf of itself and as assignee of Jawara Small, Chester Street LLC, and Aziz Brooks v. GEICO Corporation, No. 25-cv-4201 (KAM)(JAM), United States District Court, E.D. New York (August 28, 2026) Wiz Collision, a New York City auto-body shop, regularly repaired vehicles and submitted insurance claims for customers. It alleged that GEICO repeatedly approved claims and repairs, then referred certain claims to its Special Investigations Unit, stopped issuing payments, and delayed resolution despite ultimately finding no fraud.
Wiz Collision sued on its own behalf and as purported assignee of three customers, asserting contract, good-faith, consumer-protection, and injunctive claims. GEICO removed the case and moved to dismiss under Rule 12(b)(6).
LAW
Under Rule 12(b)(6), a complaint must plead facts supporting a facially plausible claim. Article III standing requires a concrete injury, ...
Crime Requires 121-151 Months of Imprisonment
Post 5486
Posted on September 9, 2026 by Barry Zalma
Mr. Baiyewu Is Liable For The Loss Resulting From Acts Directly Attributable To Him And For The Loss Resulting From The Reasonably Foreseeable Acts Of Others Taken In Furtherance of the Criminal Activity
In United States Of America v. Oluwasegun Baiyewu, CRIMINAL No. 21-395 (RAM), United States District Court, D. Puerto Rico (August 26, 2026) the court dealt with a case after on October 20, 2021, a grand jury in the District of Puerto Rico returned a single-count Indictment charging Mr. Baiyewu with conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h). About a year and a half later, on March 31, 2023, a grand jury returned a single-count Superseding Indictment charging Mr. Baiyewu and four co-defendants with conspiracy to commit money laundering, in violation of 18 U.S.C.
CONVICTION
Baiyewu was convicted by a jury of conspiracy to commit money laundering under 18 U.S.C. § 1956(h). The charged conspiracy, ...
Crime Requires 121-151 Months of Imprisonment
Post 5486
Posted on September 9, 2026 by Barry Zalma
Mr. Baiyewu Is Liable For The Loss Resulting From Acts Directly Attributable To Him And For The Loss Resulting From The Reasonably Foreseeable Acts Of Others Taken In Furtherance of the Criminal Activity
In United States Of America v. Oluwasegun Baiyewu, CRIMINAL No. 21-395 (RAM), United States District Court, D. Puerto Rico (August 26, 2026) the court dealt with a case after on October 20, 2021, a grand jury in the District of Puerto Rico returned a single-count Indictment charging Mr. Baiyewu with conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h). About a year and a half later, on March 31, 2023, a grand jury returned a single-count Superseding Indictment charging Mr. Baiyewu and four co-defendants with conspiracy to commit money laundering, in violation of 18 U.S.C.
CONVICTION
Baiyewu was convicted by a jury of conspiracy to commit money laundering under 18 U.S.C. § 1956(h). The charged conspiracy, ...
