Yesterday in Florida, the state’s Chief Financial Officer Jeff Atwater, along with Miami-Dade State Attorney Katherine Fernandez Rundle announced the arrest of seventeen people, including a clinic owner and employees, doctors, and staged recruiters, in the action known as “Operation Deep Horizon.” This makes it the state’s biggest auto personal injury protection (PIP) insurance bust.
Atwater touted the operation as representative the state’s commitment to ending auto insurance fraud, saying, “This case is just one example of the hundreds or similar fraud schemes run daily by accident clinics operating throughout Florida.” He added, “The fraud schemers bill insurance companies for procedures that never happened and we all get stuck with the bill through increased auto insurance premiums.”
These arrests involved fraudulent billing by five clinics in Miami-Dade county, including AB Diagnostic, Coral Way Rehabilitation, Medico de la Familia, New Horizon Practice, and Therapium Health Corporation.
According to investigators, Else Terrero, owner of New Horizon Practice, allegedly helped to organize staged accidents, directing participants where to go for treatment afterward. Dr. Gerald Amado then signed paperwork documenting follow-up visits and treatments that had never actually occurred.
At Medico de la Familia, it was alleged that the staff recruited and paid people to come to the clinic and be coached on how to commit fraud by learning specific responses to insurance company inquiries. As well, Dr. Gustavo Acosta signed paperwork for examination that were never performed.
Investigators charged that all five clinics had employees who were involved in obtaining and creating fake claims which were then submitted to insurance companies for payment.
Katherine Fernandez Rundle, Miami-Dade State Attorney, spoke to the press, saying, “When professional healers become professional criminals in order to make some easy cash we all lose and this insurance fraud scheme could not have worked without medical professional claiming serious injuries where none existed. Lies upon lies led to dollars upon dollars for all the parties charged today.”
In addition to the seventeen people already arrested, investigators are still seeking eight other people involved in the case. Between them, the twenty-five involved individuals face a total of 142 charges, including insurance fraud, grand theft and organized theme to defraud, racketeering, and staging accidents. Under Florida state law, staging an accident alone carries a mandatory minimum sentence of two years in prison. Collectively, the involved parties face up to 1,115 years behind bars.
Working along-side state investigators were the investigative units of several insurance companies, including, Gainsco, GEICO, Imperial Fire & Casualty, Mercury Insurance, and State Farm. The units were praised for their substantial assistance to the overall investigation, as were the U.S. Secret Service Electronic Crimes Task Force and the National Insurance Crime Bureau (NICB).
According to the NICB, Florida ranks first in the nation for staged accidents, with Miami having the third highest number of questionable claims. The Insurance Information Institute says that the average Florida family with two cars pays $100/year more in insurance premiums because of insurance fraud.
“If you multiply that by 11 million cars in our state it amounts to nearly a billion dollar fraud tax,” said Atwater.
The arrest comes just days before the opening of Florida’s legislative session where reforming the state’s no-fault system is a top priority of lawmakers, insurers and consumer groups.