Allstate Insurance Company Files $2 Million Insurance Fraud Case

HAUPPAUGE, N.Y., March 14, 2012 /PRNewswire/ -- Allstate Insurance Company has filed its first insurance fraud lawsuit of 2012, seeking to recover $2 million dollars against 27 New York area defendants.  The Complaint names multiple physicians, chiropractors, medical professional corporations, and clinic lay-owners allegedly used to control the medical professional corporations, including 18 individual defendants currently under federal indictment.

The complaint alleges that New York medical professional corporations known as St. John Medical Care, P.C., Lenox Wellcare Medical, P.C., CB Chiropractic, LLC, New Age Orthopedic Rehabilitation, P.C., First Aid Medical Care, P.C., Rosedale Medical, P.C., TDL Medical, P.C., LDT Medical, P.C., and West End Chiropractic, P.C., were fraudulently incorporated through a scheme using the names of licensed medical physicians and chiropractors, and that lay-owners, none of whom were physicians, secretly owned and controlled the professional corporations. 

The lawsuit was filed following an investigation by Allstate's Special Investigative Unit and seeks reimbursement for no–fault benefits Allstate paid on behalf of its customers during timeframes specified in the lawsuit.  The lawsuit is the latest in a string of actions taken by the insurer to protect consumers from these and similar activities. Since 2003, Allstate has filed 37 fraud lawsuits in New York State seeking more than $ 201 million in damages.

According to the Insurance Information Institute, the state of New York is in an insurance fraud crisis and no-fault fraud is costing New Yorkers millions of dollars year-after-year in higher premiums.  "In essence, honest, hardworking New Yorkers are paying a 'fraud tax,'" said Krista Conte, spokesperson for Allstate's New York office.  "We need lawmakers to enact meaningful insurance reform that puts the citizens of New York first."

Allstate is joined by other insurers and many New York State leaders in its pursuit for comprehensive reform of the no-fault system.  "The no-fault system is being exploited and responsible citizens are the victims," Conte said.  "Without the support of lawmakers, incidents of fraud will continue to increase.  We need to work together this legislative session to fix the broken no-fault system."

For more information on the dangers of insurance fraud, and how you can help fight it, please visit Fraud Costs NY at www.i-issues.com/new-york

The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer known for its "You're In Good Hands With Allstate®" slogan. Now celebrating its 80th anniversary as an insurer, Allstate is reinventing protection and retirement to help nearly 16 million households insure what they have today and better prepare for tomorrow. Consumers access Allstate insurance products (auto, home, life and retirement) and services through Allstate agencies, independent agencies, and Allstate exclusive financial representatives in the U.S. and Canada, as well as via www.allstate.com and 1-800 Allstate®.

SOURCE Allstate Insurance Company

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