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.
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Insurance Expert May Not Testify to Speculative and Contains Unsupported Conclusions.
Posted on September 18, 2026 by Barry Zalma
See the full video at and at https://rumble.com/v7fmifw-expert-may-only-testify-to-what-experience-supports.html
In Michele A. Over, and The Estate Of Paul R. Over v. State Farm Mutual Automobile Insurance Company, and State Farm Fire And Casualty Company, Civil Action No. 23-cv-02243-PAB-STV, United States District Court, D. Colorado (September 14, 2026) Michele and Paul Over sued State Farm Fire and State Farm Auto over hail-damage and stolen-vehicle claims.
The operative dispute concerned State Farm Auto’s motion to exclude or limit opinions from plaintiffs’ insurance-industry expert, Aaron Castillo. Castillo.
Law
The proponent of expert testimony must establish by a preponderance of the evidence that an expert is qualified and that the opinions are helpful, sufficiently grounded, and reliably derived and applied. Experience-based opinions must explain how the...
150 Months in Prison for Tax Fraud
Post 4846
Posted on September 17, 2026 by Barry Zalma
See the full video at https://lnkd.in/g8rh3JBX and https://lnkd.in/gmkdy-9C, In United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
In United States Of America v. Thomas Addaquay, United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
Thomas Addaquay controlled United Consolidated Accounting and Business Services (UC), nominally a check-cashing business.
The government proved a three-stage tax-refund scheme that converted the resulting refund checks into usable funds through ...
Major Fraud Perpetrator Asserts Fifth Amendment Privilege to Avoid Prosecution
Post 5489
Posted on September 14, 2026 by Barry Zalma
Fraudster Refuses to Answer Questions About His Alleged Fraud
See the full video at https://lnkd.in/gvicAMDr and at https://lnkd.in/gvicAMDr
In Great American Insurance Co. v. Gemstone Property Management, LLC, et al., No. 23-cv-9100 (LJL), United States District Court, S.D. New York (September 8, 2026) Great American Insurance Company alleged that it was defrauded through a scheme in which Subin Associates, LLP recruited individuals to stage construction-site injuries, arranged unnecessary medical treatment and litigation funding, and pursued fraudulent personal-injury claims.
Luis Manuel Garcia Salcedo, resulted in a $6 million settlement. Non-party Jose Hernandez allegedly worked as an assistant manager at Subin, operated Hernandez Associates, and owned litigation-funding companies that shared office space with Subin and provided services to its clients.
After Great American ...
Claims of Res Judicata and Procedural Default Defeats Habeas
Post 5543
Posted on November 13, 2026 by Barry Zalma
A Health Insurance Fraud Conviction Rested On Knowingly Submitting Materially False Or Misleading Claim Information With Specific Intent To Defraud.
A Health Insurance Fraud Conviction Rested On Knowingly Submitting Materially False Or Misleading Claim Information With Specific Intent To Defraud.
In Tariq Mustafa Abdulaziz v. Commissioner Of Correction, No. CV 26-5002432-S, Superior Court of Connecticut, Judicial District of Tolland, Habeas Docket (October 29, 2026) Tariq Mustafa Abdulaziz submitted 114 claims for in-home, face-to-face services purportedly provided to thirty program participants during four one-week periods. The department paid Neurostrategies, Inc., $13,650.
FACTS
The defendant waived his right to a jury trial and elected a trial to the court, D'Addabbo, J. Trial occurred over the course of eight days in August, 2022. The state presented testimony from ten witnesses and introduced thirty-three exhibits into ...
Theft of Confidential Information
Post 4581
Posted on November 12, 2026 by Barry Zalma
In People Center, Inc. v. Deel, Inc., et al., No. 25-cv-02576-CRB (LJC), United States District Court, N.D. California (November 7, 2026) People Center, doing business as Rippling, and Deel compete in payroll and human-resource management software. Rippling alleges that Deel and its executives recruited Rippling employee Keith O’Brien, based in Ireland, to disclose confidential information and trade secrets.
THE IRISH SUIT
Rippling sued O’Brien in Ireland and Deel in the United States. O’Brien subsequently retained separate counsel, supplied an affidavit describing the alleged espionage, and entered into a Cooperation Agreement with Rippling. In exchange for his cooperation, Rippling agreed to provide financial assistance, indemnification, and conditional dismissal of the Irish proceedings. The agreement also permitted renewed proceedings or a monetary judgment upon a material breach.
The Irish proceedings against O’Brien were dismissed...
A Proposed Amended Complaint That Includes New Factual Allegations to Remedy Pleading Deficiencies
Posted on November 11, 2026 by Barry Zalma
After Dismissal Fraud Victim May Amend Complaint After Dismissal
Post 4580
If A Proposed Amendment Is Not Clearly Futile, Then Denial Of Leave To Amend Is Improper
In John Hancock Life & Health Insurance Company v. Caring Connections LLC, Arthur Feldheim, and Blime a/k/a Vera Feldheim, Civ. No. 25-7574 (MAS)(JBD), United States District Court, D. New Jersey (November 6, 2026) John Hancock sued Caring Connections LLC, Arthur Feldheim, and Blime a/k/a Vera Feldheim on June 5, 2025, asserting thirteen claims, including fraud, breach of contract, and aiding and abetting fraud.
On March 26, 2026, this Court entered an order granting Caring Connections’ motion to dismiss and granting in part and denying in part the Feldheims’ motion to dismiss. The dismissed claims were dismissed without prejudice, and John Hancock timely sought leave to amend.
They also argued that the New ...
