Happy 250th Anniversary America
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5384
ZIFL – Volume 30 Issue 13 July 1, 2026
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:
A Very Expensive, Supposedly Successful, Fraud
Arbitration Concluded Multimillionaire was Defrauded by Key Employee Who Initiated the Arbitration
Fahad Ghaffar was found to have breached his fiduciary duty by advising John Paulson against making an investment in a payments company, then turned a $35.7 million profit by buying the shares himself, the arbitrator, Carolyn Demarest, said. She also found that Ghaffar hid his interest in a software company in which he “fraudulently induced” Paulson to make a $12.2 million investment.
John Paulson was awarded more than $47 million by Demarest who found that the billionaire’s former Puerto Rico business partner cheated him on one investment and usurped him on another.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
Court Applies the Law as Written
Failure to Plead Sufficient Facts to State a Facially Plausible Claim Defeats Suit
Allegedly Screwed by Insurance Brokers Judge Allows Plaintiff to Continue Some of His Suit
In Wilfredo Cruz, et al. v. Bay Point Insurance LLC, et al., Civil Action No. GLR-25-44, United States District Court, D. Maryland on June 10, 2026 dealt with a suit brought by Wilfredo Cruz who alleged that Bay Point Insurance LLC, Karl Smith, and David Small committed insurance fraud in connection with insurance policies brokered for Cruz’s trucking business, W&DC General Contractor, LLC.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
National Health Care Fraud Takedown Results in 455 Defendants Charged in Connection with Over $6.5 Billion in Alleged Fraud
Although I Usually Only Publish Convictions I Thought This DOJ Press Release Was Important
Record Medicaid Fraud Charges Largest Number of States Participating in Health Care Fraud Takedown History
The Justice Department on June 23, 2026 announced the 2026 National Health Care Fraud Takedown, which resulted in charges against 455 defendants, including 90 doctors and other licensed medical professionals, for their alleged participation in health care fraud and opioid abuse schemes involving over $6.5 billion in false claims and significant patient harm, including death. Today’s Takedown represents a new era in federal, state, and international cooperation to combat health care fraud: cases in 56 federal districts and 45 U.S. states and territories, with 50 state Medicaid Fraud Control Units participating, the most in Department history.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
More McClenny Moseley & Associates Issues
This is ZIFL’s forty-sixth installment of the saga of McClenny, Moseley & Associates and its problems with the federal courts in the State of Louisiana and what appears to be an effort to profit from what some Magistrate and District judges indicate may be criminal conduct to profit from insurance claims relating to hurricane damage to the public of the state of Louisiana. This is truly becoming a never-ending story.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
Federal Insecticide, Fungicide, and Rodenticide Act Requires Reversal
Million Dollar Roundup Verdict Reversed by SCOTUS
FIFRA Preempts the State-Law Failure-to-Warn Claim
In Monsanto Co. v. Durnell, Certiorari To The Court Of Appeals Of Missouri, Eastern District, No. 24–1068, argued April 27, 2026, decided June 25, 2026, the Supreme Court reversed a $1 million judgment found by a Missouri state court.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
Health Insurance Fraud Convictions
Ahold Delhaize USA Inc. to Pay $40M for Allegedly Reporting Inflated Drug Prices on Claims to Federal Healthcare Programs
Ahold Delhaize USA Inc. (Ahold Delhaize), headquartered in Quincy, Massachusetts, agreed to pay the United States and participating states a total of $40 million to resolve allegations that it violated the False Claims Act and state analogs by reporting inflated “usual and customary” prices on claims to federal healthcare programs.
Read the full article and the full 7-1-2026 issue of ZIFL and dozens of convictions at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf.
Lawyer & State Senator Permanently Disbarred
Taking Money From a Client Trust Account Warrants Severe Disciplinary Sanction
Stealing from a Client is Reprehensible
In In Re: Derrick D.T. Shepherd, No. 2026-OB-00357, Supreme Court of Louisiana (June 25, 2026) petitioner Derrick D.T. Shepherd, a former Louisiana State Senator and attorney, pleaded guilty in 2008 to conspiracy to commit money laundering after using his client trust account to help launder nearly $141,000 in fraudulently generated bond fees. The Louisiana Supreme Court permanently disbarred him in 2012, finding that his criminal conduct, use of a trust account, false billing records, and public position warranted the most severe disciplinary sanction.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
Other Than Health Insurance Fraud Cases
Former Commissioner of the Virgin Islands Police Department and Former Management and Budget Director Sentenced for Bribery Scheme
Ray Martinez, the former Commissioner of the Virgin Islands Police Department (VIPD), and Jenifer O’Neal, the former Director of the Virgin Islands Office of Management and Budget (OMB), were sentenced for their roles in a procurement fraud, bribery, and money laundering scheme. Martinez was sentenced to 10 years in prison and three years of supervised release, and O’Neal was sentenced to seven years in prison.
Read the full article and the full 7-1-2026 issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/06/ZIFL-07-01-2026.pdf
(c) 2026 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma
4441 Sepulveda Boulevard, CULVER CITY CA 90230-4847
310-390-4455, [email protected], https://zalma.com
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 also serves as an arbitrator or mediator for insurance related disputes.
Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.
Go to Zalma’s Insurance Fraud Letter at https://zalma.com/zalmas-insurance-fraud-letter-2/
Arsonist Tried To Represent Himself, Failed, and Sought Habeas Relief
Post number 5357
Read the full article at https://www.linkedin.com/pulse/he-who-acts-his-own-lawyer-has-idiot-client-barry-zalma-esq-cfe-d4bwc, See the full video at and at and at https://zalma.com/blog.
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
See the full video at and at and at https://zalma.com/blog plus 5300 posts.
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 ...
Happy 250th Anniversary America
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5384
ZIFL – Volume 30 Issue 13 July 1, 2026
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:
A Very Expensive, Supposedly Successful, Fraud
Arbitration Concluded Multimillionaire was Defrauded by Key Employee Who Initiated the Arbitration
Fahad Ghaffar was found to have breached his fiduciary duty by advising John Paulson against making an investment in a payments company, then turned a $35.7 million profit by buying the shares himself, the arbitrator, Carolyn Demarest, said. She also found that Ghaffar hid his interest in a software company in which he “fraudulently induced” Paulson to make a $12.2 million investment.
...
Taking Money From a Client Trust Account Warrants Severe Disciplinary Sanction
Post number 5383
Stealing from a Client is Reprehensible
Read the full article at https://www.linkedin.com/pulse/lawyer-state-senator-permanently-disbarred-barry-zalma-esq-cfe-ixf9e and at https://zalma.com/blog plus more than 5350 posts.
In Re: Derrick D.T. Shepherd, No. 2026-OB-00357, Supreme Court of Louisiana (June 25, 2026) petitioner Derrick D.T. Shepherd, a former Louisiana State Senator and attorney, pleaded guilty in 2008 to conspiracy to commit money laundering after using his client trust account to help launder nearly $141,000 in fraudulently generated bond fees. The Louisiana Supreme Court permanently disbarred him in 2012.
Shepard returned $75,000 to Ms. Moyo and kept the rest of the funds for himself, using $20,000 to retire his campaign debt. To conceal all of this activity, Shepard created false billing statements and time records reflecting work his law firm had purportedly done on behalf of his “client,” Ms. ...
Negligent Hiring Tort not Preempted by Federal Statute
Read the full article at https://www.linkedin.com/pulse/faa-authorization-act-does-preempt-all-state-tort-zalma-esq-cfe-6jkvc and at https://zalma.com/blog plus more than 5350 posts.
In Shawn Montgomery v. Caribe Transport II, LLC, et al., 608 U.S.__ No. 24-1238, United States Supreme Court (May 14, 2026) Shawn Montgomery suffered severe and permanent injuries when his tractor trailer was struck by a truck driven by Yosniel Varela-Mojena while Varela-Mojena was transporting plastic pots through Illinois for Caribe Transport II, LLC. C.H. Robinson Worldwide, Inc., acting as a transportation broker, had arranged the shipment.
Montgomery sued the driver, the motor carrier, the broker, and related entities, alleging that C.H. Robinson negligently hired Varela-Mojena and Caribe Transport despite safety information that allegedly showed Caribe Transport posed an unreasonable risk of crashes and injury.
LAW
The Federal Aviation Administration Authorization Act ...
