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:
Swoop & Squat Fails
The Only Solution to Fraud is to Take the Profit Out of the Crime
It Takes Courage to Fight the Fraudster
In Vivian Maritza Triana Marin, Sebastian Arroyave Penagos, and Daniel Arroyave Penagos v. Marc J. Paynter and Transport Marc Paynter Inc., No. 23-CV-6498, United States District Court, E.D. New York (July 10, 2026) Plaintiffs sued Defendants in diversity after a rear-end collision on the Whitestone Expressway in Queens, New York.
Commit Fraud and Suffer Consequences
Victims of Fraud Should Always Fight Back Proactively
Cross-Claim Against Fraudsters Successful
In Dual Diagnosis Treatment Center, Inc., et al. v. Health Net, Inc., et al., Health Net Life Insurance Company, B331260, California Court of Appeals, Second District, Third Division (July 16, 2026) a trial verdict in favor of Health Net and against Sovereign, a network of mental health and substance use disorder treatment centers, and Health Net, Inc., Health Net of California, Inc., Health Net Life Insurance Company, and Managed Health Network, Inc. (collectively, Health Net) was appealed to the California Court of Appeals.
More McClenny Moseley & Associates Issues
This is ZIFL’s forty-seventh 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.
Texas-based MMA Law Firm PLLC moved to protect owner and attorney John Zachary Moseley from a litigation funder suit during the firm’s bankruptcy.
Trouble at Lloyd’s
According to Claims Magazine, Lloyd’s corporate offices have stated that former CEO John Neal breached its compliance rules.
The Lloyd’s investigation found that Neal failed to disclose the relationship with the group’s former corporate affairs director Rebekah Clement.
The Great Jewel Theft
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.
Read the full article and all 28 pages of ZIFL athttp://zalma.com/blog/wp-content/uploads/2026/07/ZIFL-08-01-2026.pdf
Health Insurance Fraud Convictions
EyePoint Pharmaceuticals to Pay $4.6 Million to Resolve False Claims Act Allegations
Eyepoint Pharmaceuticals, Inc., (EyePoint) headquartered in Massachusetts, has agreed to pay the United States $ 4,657,463.18 to resolve allegations that it violated the False Claims Act by paying kickbacks to certain Ambulatory Service Centers (ASCs) to induce those ASCs to purchase and dispense DEXYCU, an injectable drug approved for the treatment of ocular inflammation following cataract surgery, between January 1, 2019 and March 1, 2023.
The Real Cost of Fraud
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 names and places of this true crime story were changed to protect the guilty.
New Jersey Consumer Fraud Act Now Covers Insurance Brokers, Agents, and Producers
On July 15, 2026, the New Jersey Supreme Court issued a decision overturning lower court rulings that had shielded “semi-professionals” — including insurance brokers, agents, and producers, among others — from regulation and litigation under the New Jersey Consumer Fraud Act (NJCFA).
Insurer Proactively Works to Defeat Fraud
RICO and PIP Fraud Not Subject to Arbitration in New Jersey
The Only Way to Defeat Fraud is to Eliminate the Fraudster’s Profit
In Allstate New Jersey Insurance Company, et al v. Carteret Comprehensive Medical Care, PC, d/b/a Monroe Comprehensive Medical Care, d/b/a Comprehensive Medical Care, d/b/a Fassst Sport, d/b/a Comprehensive Vein Care, Inimeg Management Company, Inc., et. al. Nos. A-74-24, A-75-24, A-76-24, No. 090337, Supreme Court of New Jersey (July 21, 2026).
Other Than Health Insurance Fraud Case
Nevada Businesswoman Sentenced to Prison for Fraudulent Scheme Seeking Millions in COVID-19 Tax Credits
Caused a Loss to the United States Exceeding $7 Million
Adonia Stiles, of Las Vegas, was a real estate agent, tax preparer, and clothing store owner.
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 also serves as an arbitrator or mediator for insurance related disputes.
[email protected], http://www.zalma.com, http://zalma.com/blog
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Read the full article and all 28 pages of ZIFL athttp://zalma.com/blog/wp-content/uploads/2026/07/ZIFL-08-01-2026.pdf
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 ...
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 ...
Mere Negligence, Poor Judgment, Delay, Inadequate Investigation, Valuation Disagreement, or an Honest Mistake May Not Establish Bad Faith.
Post 5433
Posted on August 25, 2026 by Barry Zalma
In Joseph Russell Falasco v. USAA Casualty Insurance Company, No. 25-2632, United States Court of Appeals, Eighth Circuit (August 18, 2026) Joseph Russell Falasco insured a restored 1974 Porsche 911S through USAA. After the Porsche caught fire in August 2023, Falasco reported the loss and initially believed the vehicle was a total loss. USAA investigated the origin and cause of the fire, sent a reservation-of-rights letter, retained an appraiser, and referred the claim to its special investigations unit after questions arose about whether the fire was accidental.
The investigation ultimately indicated the fire likely resulted from deteriorated fuel lines rather than intentional conduct.
USAA offered $46,106.75 based on a CCC valuation using two comparable Porsche vehicles. Falasco disputed the valuation, argued the comparables ...
Federal Court Should Not Conflict With State Court Action
Post 5432
Posted on August 24, 2026 by Barry Zalma
New Mexico State Lawsuits Cannot be Confused with a Federal Declaratory Relief Action
In Old Guard Insurance Co. v. Rudolfo Rodriguez; Emilio Pinon; et al, The City Of Albuquerque; Mayor Tim Keller; Jesse Valdez; And Consolidated Builders Of New Mexico et al., No. 1:26-cv-00073-MIS-JMR, United States District Court, D. New Mexico (August 18, 2026), Old Guard Insurance sought a federal declaratory judgment that it owed no duty to defend or indemnify Consolidated Builders and related defendants in asbestos-related New Mexico state lawsuits arising from renovation work at Albuquerque’s Gibson Health Hub/Gateway Center.
FACTS
On January 15, 2026, Old Guard filed the instant lawsuit seeking a declaration that there is no coverage for various asbestos-related claims under the Policy
Old Guard initially denied coverage to Consolidated Builders when the underlying state suits were filed, but reversed its ...
Habeas Relief from an Insurance Fraud Conviction Based on an Incorrect Factual Determination Unavailable
Post 5431
Posted on August 21, 2026 by Barry Zalma
A Prisoner Seeking A Writ Of Habeas Corpus Has No Absolute Entitlement To Appeal A District Court’s Denial Of His Petition.
In Bryce A. Nickelson v. Secretary, Department Of Corrections, No. 8:23-cv-1081-KKM-SPF, USDC, M.D. Florida, Tampa Division (August 17, 2026) Bryce Nickelson, a Florida prisoner, was convicted by a state jury of making a false and fraudulent insurance claim and sentenced to 92.55 months in prison.
The evidence showed that Nickelson’s Dodge Durango had been damaged before he obtained comprehensive coverage from Progressive.
Progressive denied the claim for misrepresentation, and Nickelson later admitted he had not been truthful when initiating the claim.
A state court’s findings of fact are presumed correct, and a petitioner can rebut the presumption of correctness afforded to a state court’s factual findings only by ...
