What is Insurance Fraud?
Fraud occurs 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. According to the law, the crime of insurance fraud can be prosecuted when:
- The suspect had the intent to defraud. Insurance fraud is a "specific" intent crime. This means a prosecutor must prove that the person involved knowingly committed an act to defraud.
- An act is completed. Simply making a misrepresentation (written or oral) to an insurer with knowledge that is untrue is sufficient.
- The act and intent must come together. One without the other is not a crime.
- Actual monetary loss is not necessary as long as the suspect has committed an act and had the intent to commit the crime.
What Types of Insurance Fraud or Other Crimes Does the Fraud Division Handle?
The Fraud Division is responsible for enforcing the provisions of Chapter 12 of the California Insurance Code, commonly referred to as the Insurance Fraud Prevention Act. Current law requires the Fraud Division to investigate various felony provisions of the Insurance Code as well as other crimes including California Penal Code, Sections 548-550 and California Labor Code, Section 3700.5. Investigations conducted by the Fraud Division usually involve some aspect of suspected insurance fraud or other related crimes.
Cases investigated by the Fraud Division most often consist of criminal acts involving automobile property and personal injury, workers' compensation, health insurance and residential and commercial property claims. Some examples of the types of insurance fraud investigated include:
California and federal laws also permit the Fraud Division to pursue cases federally. In those instances, the crime of insurance fraud is usually pursued as mail fraud, criminal racketeering or other federal offenses.