Insurance fraud can be complex and comes in many different forms. Sometimes individuals ask a body shop to inflate the estimate for car repairs, other times owners “give up” cars to report them stolen, and sometimes insurance fraud takes a well-connected group of people known as staged collision rings or medical mills.

However, other cases of suspected fraud are simply misunderstandings. Making an insurance claim can be a complicated process, and people make honest mistakes when investigating damage or filling out forms.

No matter the circumstances of your particular case, The Law Office of Peter Blair is equipped to handle it. Contact us for a free and confidential consultation to get started on your defense strategy.

Legal Definitions

California defines insurance fraud as “when someone knowingly lies to obtain a benefit or advantage to which they are not otherwise entitled” or “someone knowingly denies a benefit that is due and to which someone is entitled.” In layman’s terms, insurance fraud has occurred when someone intentionally provides false information or hides information to get a payment or other benefit that they otherwise would not.

Several laws govern insurance fraud in the state of California. Section 810 of the Business and Professions Code deals with fraud, and Chapter 12 of the California Insurance Code is known as the Insurance Frauds Prevention Act.

Under sections 549-550 of the California Penal Code, it is illegal to knowingly:

  • Present (or cause to be presented) any false or fraudulent claim for the payment of a loss or injury, including payment of a loss or injury under a contract of insurance
  • Present multiple claims for the same loss or injury, including presentation of multiple claims to more than one insurer with an intent to defraud
  • Cause or participate in a vehicular collision, or any other car accident, for the purpose of presenting any false or fraudulent claim
  • Present a false or fraudulent claim for the payments of a loss for theft, destruction, damage, or conversion of a motor vehicle, a motor vehicle part, or contents of a motor vehicle
  • Prepare, make, or subscribe any writing, with the intent to present or use it, in support of any false or fraudulent claim
  • Make any false or fraudulent claim for payment of a health care benefit
  • Submit a claim for a health care benefit that was not used by (or on behalf of) the claimant
  • Present multiple claims for payment of the same health care benefit with an intent to defraud
  • Present for payment any undercharges for health care benefits on behalf of a specific claimant unless any known overcharges for health care benefits for that claimant are presented for reconciliation at that same time
  • Present any written or oral statement as part of a claim for insurance payment, knowing that the statement contains false or misleading information
  • Conceal (or fail to disclose the occurrence of) an event that affects any person’s initial or continued right or entitlement to any insurance benefit or payment
  • Prepare or make any statement (intended to be presented to any insurer or producer) for the purpose of obtaining a car insurance policy that indicates the person is a resident of one state when, in fact, the person is not

Legal Defenses

Depending on the unique situation of your case, many different defense strategies are possible. An experienced criminal defense attorney will be able to fully explain your legal options.

Common defenses against an accusation of insurance fraud include:

  • Lack of intent to defraud: A fraud conviction requires that the defendant intended to commit fraud, and a prosecutor must adequately prove the defendant’s intent. Lack of intent to defraud could mean the defendant made a mistake, he or she believed the claim was legitimate, or he or she was swindled by someone else and was unaware of the fraud taking place.
  • Insufficient evidence: Many insurance fraud claims are based on circumstantial evidence, and “intent to defraud” is not easy to prove. If there is insufficient evidence to prove you intended to commit fraud, your case could be thrown out.
  • Entrapment: If the government compels an innocent person to commit a crime they would not have otherwise committed, entrapment has taken place. However, entrapment defenses can be difficult, and the defendant must prove that the government actor did more than just provide an opportunity to commit fraud.

Penalties, Punishment, and Sentencing

Depending on the specifics of the alleged insurance fraud, it can be handled as an administrative action by the California Department of Insurance, or it can be handled as a criminal matter by the Fraud Division. The Fraud Division of the California Department of Insurance handles several types of fraud, including car accident claims, medical claims, workers compensation claims, fire claims, property claims, and health care claims.

In the state of California, a prosecutor must prove that someone intentionally completed a fraudulent act in order to receive a benefit from an insurance company. It is important to note that the intention and the act must both be present for insurance fraud to have occurred; one without the other is not grounds for insurance fraud. However, trying and failing to commit insurance fraud is still punishable.

Prosecutors can charge a suspect with either a misdemeanor or a felony when it comes to insurance fraud. Misdemeanor insurance fraud is punishable by up to one year in county jail, a fine of up to $10,000, or both.

Felony insurance fraud is punishable by two, three, or five years in state prison and a possible fine of up to $50,000 or double the value of the defrauded amount (whichever is greater). Felony insurance fraud for workers compensation benefits carries a potential fine of up to $150,000 or double the value of the defrauded amount (whichever is greater). California state courts can also require the defendant to pay restitution, which compensates the victims of insurance fraud for actual financial losses.

A previous felony conviction for insurance fraud opens up the defendant to increased jail time, adding two years for each prior offense.

Consult an Experienced Criminal Defense Lawyer

If you find yourself facing charges for insurance fraud, contact The Law Office of Peter Blair as soon as possible. We understand that the accusations against you are not a representation of who you are, and we will work tirelessly on your behalf. Call (619) 357-4977 or click here to schedule your free and confidential consultation.