Commissioner Lara announces over $50.5 million in grants awarded statewide to assist law enforcement in fighting fraud

News: 2023 Press Release

SACRAMENTO, Calif. - Insurance Commissioner Ricardo Lara today announced he has awarded $50,545,239 in grants to 34 district attorney offices representing 44 counties in California to combat insurance fraud. Under Commissioner Lara’s leadership, these grants, funded through annual employer assessments, support law enforcement efforts in investigating and prosecuting fraud and increase outreach to our communities. Commissioner Lara also awarded an additional $400,000 in grants to protect consumers, the majority of whom are seniors, from abuse involving the sale of individual life and annuity products as part of the Life and Annuity Consumer Protection Program.

“Insurance fraud continues to be a drain on our economy. Partnership between my Department’s investigators and local law enforcement is crucial in fighting fraud and educating the public,” said Commissioner Lara. “These annual grants continue to show my Department’s long-standing commitment to investigating and working with our law enforcement partners to combat fraud and protect consumers, businesses, and the insurance marketplace.”

Since Commissioner Lara took office in 2019, the Department has particularly focused these grants on increasing outreach throughout the state, especially to our state’s diverse and underserved communities. These grants also fund essential outreach programs for individual district attorney offices to deter fraud and increase consumer awareness. Consumers are sometimes unaware of their rights or are reluctant to exercise them. Outreach programs will educate them of those rights and of best anti-fraud practices to protect themselves and their loved ones. Visit our website for information on scams consumers and business may be susceptible to. 

The other focus for these grants is combating workers’ compensation fraud. A large part of these grants will go to the investigation and prosecution of medical provider fraud in the workers’ compensation system, protecting Californians who are unwittingly ensnared in schemes to bill for unnecessary or profit motivated medical treatment. A recent example of this type of fraud was the sentencing of former doctor, Julien Omidi, to 84 months in federal prison after a joint investigation with the Department and law enforcement partners found that he defrauded insurance companies by fraudulently submitting nearly $120 million in claims.

Department investigators also work with law enforcement partners to target employer premium fraud, employer defrauding employee fraud, insider fraud, claimant fraud, uninsured employers operating within the underground economy, and exploitation of workers. These investigations level the playing field for honest businesses and discourage future fraudulent activity, and protect all Californians. A recent example of this was the plea agreement reached with Golden Foods Inc. where the company admitted to a litany of labor violations, which includes over $437,000 in stolen wages ultimately paid back to more than 30 California workers.

The grants awarded through the Life and Annuity Consumer Protection Program protect all California consumers through the investigation of life and annuity transactions involving theft, embezzlement, twisting and churning, forgery, material misrepresentations, advanced commission schemes, and identity theft. The successful investigation and prosecution of these insurance crimes play an important role in protecting consumers and deterring fraudulent activities. In a recent investigation, two co-conspirators wereconvicted of grand theft and ordered to pay a total of $500,000 in restitution to the family of their victim, who they defrauded and convinced to purchase unnecessary annuities.

# # #