Insurance Fraud (Chapter 35 Penal Code includes - Auto, Home Owner, Unemployment, Health Care Fraud)
If you or a loved one have been accused of any form of insurance fraud in the state of Texas, you will be facing serious consequences should you be convicted.
Texas Penal Code Chapter 35 targets auto, homeowner's, unemployment, and healthcare insurance fraud with steep penalties, seeking to protect other policy holders from the impact of fraudulent claims.
However, while there are over $80 billion of fraudulent insurance claims made in the U.S. every year, there are also cases of insurers attempting to deny a valid claim by making false charges of insurance fraud. Furthermore, there are other cases in which, even if the person who submitted a claim made a mistaken or intentionally false statement, it does not amount to insurance fraud.
At the Law Office of Brian J. Newman, we have the intricate knowledge of Texas insurance fraud law and courtroom procedures to win the best possible outcome to each case. If you are facing insurance fraud charges in Fort Worth or other areas of northern and central Texas, criminal defense attorney Brian J. Newman has the expertise and tenacity it takes to win your case.
However, by also learning all you can yourself about the charges, penalties, and defense strategies related to Texas insurance fraud, you will clear up any confusion and give yourself greater confidence going forward. To get you started, here are the basics of Texas insurance fraud law:
How Texas Defines Insurance Fraud
PC Title 7, Chapter 35 is Texas' "Insurance Fraud Statute." It defines insurance fraud as an intentional submission of false/misleading information to an insurance company in pursuance of a making a claim on a policy or of being accepted for a policy to begin with.
However, such information must also be relevant to the claim so as to establish/increase it. This requirement is called "materiality."
Another form of insurance fraud is to intentionally injure oneself, damage one's own property, or stage a false incident that a claim is later filed based upon.
Examples of Insurance Fraud
There are many types of insurance, and thus, many types of insurance fraud that are possible. Some of the most common categories and typical incidents that are alleged during insurance fraud suits include the following:
- Auto Insurance Fraud: This often occurs when a claimant exaggerates the amount of damage done to his/her vehicle during an auto accident, hoping to receive a larger reimbursement.
- Property Insurance Fraud: When homes and businesses are insured, fraud can occur when storm, fire, flood, or other damage is exaggerated. It might also be that a building was set on purpose or otherwise intentionally harmed in order to make an insurance claim.
- Unemployment Insurance Fraud: There are a number of ways that fraud can be committed in relation to Texas' unemployment insurance laws. First, it may be a matter of inaccurately reporting hours worked in order to receive a larger benefit. Or, it may be inaccurate reporting of gross income. A failure to give notice of a "job separation" during the period you were receiving benefits, sharing/failing to keep secure your unemployment benefits PIN and password, using someone else's identity to apply for benefits, or trying to get benefits while in jail/prison are all also Texas unemployment insurance fraud.
- Healthcare Insurance Fraud: Examples of health insurance fraud include: falsely claiming to have a particular injury/condition in order to receive insurance pay-outs, pretending to have a health condition in order to access prescription medications (for personal use/sale), and healthcare providers submitting claims to insurers for services/operations they never actually performed. Besides being a crime in Texas and the other 49 U.S. states, healthcare insurance fraud is also a federal crime, making for additional penalties if you are convicted in both state and federal courts.
Possible Punishments for Insurance Fraud
If convicted of committing insurance fraud, you will certainly be required to restore in full all claims fraudulently obtained. You will also have to pay the court expenses of the plaintiff.
To some degree, your punishment may vary based on whether "soft" or "hard" fraud was involved. Soft fraud refers to an exaggerated claim, while hard fraud means a completely fabricated claim or one based on intentionally done damage.
However, for the most part, penalties for Texas insurance fraud vary based on the value of the fraudulently obtained claim. "Fair market value" or "replacement value" can be used as the rule to determine the value non-cash claims.
Here are some examples of sentences for Texas insurance fraud:
- Fraud of less than $100, a Class C misdemeanor, brings a $500 fine.
- Fraud of $100 to $750 is a Class B misdemeanor, punishable by 180 days in jail and a maximum fine of $2,000.
- Fraud of $750 to $2,500 is a Class A misdemeanor, punishable by up to one year in county jail and up to a $4,000 fine.
- A fraud claim of $2,500 to $30,000 is a "state jail felony," as is the providing of false information on an insurance policy application. The penalties are 180 days to 2 years in prison and a fine of up to $10,000.
- If a fraudulent claim amounts to $300,000 or more, it is a first degree felony, which is punishable by a maximum fine of $10,000 and 5 to 99 years in state prison. A fraud claim of at least $150,000 that puts someone at significant risk of death/bodily injury is also a first degree felony.
Also important to note is the fact that multiple violations can be grouped together as a single offense if they were done in pursuit of a single, overarching insurance fraud scheme. This would likely lessen the sentence compared to incidents being filed separately, but Texas PC Chapter 35 stipulates the charges shall be one level higher than the most egregious individual violation. Thus, a state jail felony would rise to a 3rd degree felony and a Class B misdemeanor rises to a Class a misdemeanor. The only exception is with a first degree felony, which cannot rise (since it is the highest level offense).
What Must the Prosecutor Prove?
The prosecution, to gain a conviction, must prove beyond all reasonable doubt the following elements of the crime of insurance fraud:
- The defendant knowingly made false/misleading statements, which were submitted to an insurance company.
- The statements in question were made in relation to a claim being filed or an insurance policy application form being submitted.
- The false or misleading statements were "material," meaning that they were important considerations in determining the approval of an application, the approval of a claim, or the amount of a claim.
How Can Insurance Fraud Charges Be Defeated?
While many may suppose that insurers have the upper hand in the courtroom and that there is little chance of defeating their allegations or even reducing the charges, this is simply not true. At the Law Office of Brian J. Newman, we frequently use such defense strategies as the following to successfully defend our clients against insurance fraud charges:
- The information being attacked as false or misleading simply is not. The insurer is misinterpreting the meaning of the defendant's statement(s).
- There was no intention to deceive/mislead, even if the information itself is false. It may, for example, have been a simple mistake or have occurred because the defendant thought at the time that the information was true.
- Though the statement was false and intentional, it did not materially affect a claim or application acceptance.
- While the insurer is alleging the entirety of the claim was false, in reality, only a portion of it resulted from false statements. (This argument could only be used to reduce the severity of a charge rather than to dismiss it).
Contact Us Today for Help
At the Law Office of Brian J. Newman, we have successfully defended numerous insurance fraud cases of every variety in the past in Texas courts. Attorney Brian J. Newman has extensive experience in Ft. Worth and surrounding areas in north Texas and knows how to form the best defense strategy to win your case.
To learn more or for a free consultation, contact Brian J. Newman anytime 24/7 by calling 817-231-0023.