ZIFL – Volume 30, Issue 6
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5304
Posted on March 16, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
There is no Statutory Right to Defraud an Insurer
Fraudsters Attempt to Use Statute to Force Payment Fails
In Connecticut General Life Insurance Co. et al. v. East Coast Advanced Plastic Surgery, LLC, No. 25 Civ. 1686 (PAE), United States District Court, S.D. New York (February 24, 2026) a dispute between Connecticut General Life Insurance Company and its subsidiary Cigna Health and Life Insurance Company (collectively, “Cigna”) and East Coast Advanced Plastic Surgery, LLC (“ECAPS”), a New Jersey-based medical practice specializing in post-mastectomy breast reconstruction.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Fraud and Artificial Intelligence
According to Gallagher Bassett’s 2026 Carrier Report, 64% of North American carriers report increased claims complexity over the past year. Medical inflation remains the most frequently cited driver of rising costs, with 56% of respondents identifying it as the top contributor. Longer recovery durations, extended wage replacement periods and a growing number of psychological injury claims are adding pressure to adjusters already managing heavier caseloads.
Gallagher Bassett’s findings were drawn from a global survey of carrier executives, underwriting leaders and claims professionals, with data and market analysis across North America, Europe, Asia‑Pacific and the U.K. Insights include quantitative survey responses and qualitative input from leaders responsible for claims, risk and operational strategy.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Allianz Reveals Case Of Broker Abusing Position As Over 34,000 Fraud Cases Identified In 2025
From the Insurance Times, A Copywritten Article you read at Link :
https://www.insurancetimes.co.uk/news/allianz-reveals-case-of-broker-abusing-position-as-over-34000-fraud-cases-identified-in-2025/1457999.article?utm_id=34468&adredir=1
Introduction :
“Fraudsters are continually changing their tactics and we need to match their efforts with greater speed and agility than ever before,’ says director of fraud”
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Press Release from the California Department of Insurance
Owners Of One Of The Largest Towing Businesses In Southern California Arrested In Nearly 6 Million Dollar Fraud Scheme
LOS ANGELES, — Brothers and tow company owners, Mark Hassan, 46, of Corona Del Mar, and Ahmed Hassan, 35 of Walnut, were arrested today on multiple counts of felony insurance fraud after allegedly underreporting employee payroll and paying portions of employees’ wages in cash to defraud workers’ compensation insurance companies out of nearly 6 million dollars of insurance premiums.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Health Insurance Fraud Convictions
Long Island Medical Doctor Sentenced to 7 Years in Prison for Operating Oxycodone Pill Mill Out of her Great Neck Office
Dr. Roya Jafari-Hassad was sentenced by United States District Judge Gary R. Brown to 7 years’ imprisonment for prescribing oxycodone pills without a legitimate medical purpose and fraudulently billing insurance providers for procedures which were never performed. In addition to the term of imprisonment, Judge Brown imposed a fine of $150,000 and ordered Jafari-Hassad to pay restitution in the amount of $152,765.
Read about 31 convictions and the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Other Than Health Insurance Fraud Cases
Tragic death uncovers alleged insurance fraud by Oxnard licensed agent
Fake Coverage Left Recreational Soccer Leagues And School District Exposed
Gonzalo Lorona, 58, a licensed insurance agent of Oxnard, California has been charged with 37 felony counts, including insurance fraud and grand theft, after a California Department of Insurance investigation found he allegedly stole client premium payments and issued fraudulent insurance certificates leaving organizations uninsured and at financial risk.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
How Not to Commit Arson
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, one of many, is designed to help insurance people 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.
Most people do not understand how hard it is to set fire to a house that will destroy the entire dwelling and its contents. Most residences simply do not have sufficient combustibles in the right place to allow for a sustained fire. Many homes, especially the more modern ones, have fail-safe devices everywhere that make accidental fires a thing of the past.
Adapted from my book Insurance Fraud Costs Everyone Available as a Kindle Book and Available as a Paperback from Amazon.com.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
WHAT IS NEEDED TO DETER INSURANCE FRAUD?
Insurers must train their staff to recognize the elements of both the crime of insurance fraud and the elements of the civil tort of insurance fraud. If well trained, insurance personnel collecting information about a potential insurance fraud, will know the type and quality of information that either a prosecutor or a civil defense lawyer will need to prove fraud was attempted.
Read the full 21 page article at http://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-03-15-2026.pdf
Barry Zalma
Barry Zalma, Inc., 4441 Sepulveda Boulevard, CULVER CITY CA 90230-4847, 310-390-4455.
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 for more than 44 years as an insurance coverage and claims handling lawyer and more than 58 years in the insurance business. He is available at http://www.zalma.com and [email protected]. Go to Zalma’s Insurance Fraud Letter at https://zalma.com/zalmas-insurance-fraud-letter-2/,
Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.
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 ...
Chutzpah is not Enough
Post 5397
Posted on July 20, 2026 by Barry Zalma
See the video and at https://lnkd.in/gNUs2XzT and at https://lnkd.in/g2MawyzX
Magistrate Issues a Search Warrant if there is a Fair Probability that Contraband or Evidence of a Crime will be Found in a Particular Place.
In United States Of America v. Frank Suess, et al., CRIMINAL No. 3:24-308, United States District Court, M.D. Pennsylvania (July 16, 2026) a federal grand jury indicted Frank Suess, Melissa Driscoll, and others in a 55-count health care fraud and anti-kickback prosecution arising from an alleged scheme involving medically unnecessary prescription “foot baths.”
As part of the investigation, the FBI obtained an August 19, 2022 warrant to search Driscoll’s Sterling Pharmacy Yahoo email account for emails from January 1, 2018 through December 31, 2020. Driscoll moved to suppress the resulting evidence, arguing that the warrant lacked probable cause, was overbroad, and rested on material misstatements and omissions.
LAW:
The ...
Fraud Shouldn’t Pay
Post 5396
See the video and at https://rumble.com/v7ctgmq-the-great-jewel-theft.html at https://youtu.be/aRbQ2sJfGwA
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.
The Insured purchased, for the first time in his life, a policy of Personal Articles Floater Insurance (PAF) scheduling $125,000 worth of ladies jewelry. He advised the insurer that the jewelry was always kept in a class E safe at his residence. He also told the insurer that he was employed full time as the owner of a gasoline service station and that he had never been canceled or suffered a previous loss.
One month after the policy was ...
Day Care Owner Loses Subsidies Because She Criticized State
Post 5421
Posted on August 11, 2026 by Barry Zalma
First Amendment Right Will be Allowed to Go to Trial
In Betsey J. Grant v. Maine State Department Of Heath And Human Services, No. 1:25-cv-00490-JAW, United States District Court, D. Maine (August 6, 2026), Betsey J. Grant, a licensed childcare provider and operator of Tiny Tikes Daycare in Trenton, Maine, sued Maine DHHS and several employees after she publicly criticized DHHS before Maine’s Government Oversight Committee and alleged that officials retaliated against her.
She claimed DHHS imposed and extended a conditional license, published stigmatizing information, interfered with subsidies and program funding, removed her from a food program, rescinded an expansion grant, and used biased or falsified evidence in licensing proceedings. Following the March 10, 2023, GOC testimony, Ms. Grant alleges that foster children's subsidies (approximately $30,000) were withheld; she was removed from the ...
Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units. After an underlying personal injury action was filed, Union Mutual determined that the property actually contained three apartment units and rescinded the policies on the ground that the defendants had made a material misrepresentation in the applications.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true ...
Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true facts been disclosed. To establish materiality as a matter of law, the insurer must submit documentation of its underwriting practices, such as manuals, guidelines, bulletins, or rules addressing similar risks.
DISCUSSION/ANALYSIS:
As a result, the...
