As business owners, we are always on the lookout for things that can affect our business, but unless one is a lawyer, owners are seldom on the lookout for trip-and-fall fraud. Though, if an owner operates in a physical location, one has to be on the lookout for premises liability issues, like the fraud scheme recently stopped by the Department of Justice.
The press release
According to the United States Attorney for the Southern District of New York the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation, the scheme was perpetrated by New York doctors and lawyers, and they defrauded businesses and insurance companies out of more than $30 million. This money was taken through fraudulent insurance reimbursement and direct compensation received from businesses through their fraudulent trip-and-fall accidents. The defendants now face mail and wire fraud charges related to the scheme.
Details of the trip-and-fall fraud
The DOJ and FBI investigation believes that the scheme started in 2012. Apparently, the defendants would state trip-and-fall (also known as, slip-and-fall) accidents, and then file fraudulent lawsuits based on those fake accidents. Essentially, the doctors and lawyers would recruit people (over 400 people were involved in this way) to stage slip-and-fall accident throughout New York City. Patients would even receive medical and chiropractic clinic, including ongoing treatments, even going as far as getting unnecessary surgeries to substantiate their claims and increase compensation.
In the beginning, the doctors would simply tell their “patients” to claim that they had fallen at a business, and then the lawyer would file a lawsuit on the patient’s behalf. Though, later, the patients would actually go to the businesses and deliberately fall. These “falls” would occur because of sidewalk cracks, cellar doors, potholes, etc.
Of course, the most direct victims of this fraud were the businesses and insurance companies that paid out millions. But, the “patients” that were recruited were often extremely poor, homeless and desperate, enough so to undergo multiple surgeries for relatively little money. Indeed, food, shoes and warm clothing were offered as incentives.
This case goes to show that, even attorneys and doctors, cannot be taken at face value when one is accused of wrongdoing or negligence. For Staten Island, New York, businesses, it is always advisable to seek help with their premises liability defense.