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What are the consequences of insurance fraud charges?

Insurance companies make a lot of money from premiums paid for health, property and liability coverage. No matter how Baton Rouge residents feel about that, state and federal fraud laws clearly forbid trying to take advantage of an insurer for personal gain.

According to the Federal Bureau of Investigation and the Insurance Information Institute, costs associated with insurance fraud in the U.S., outside the health care industry, add up to $30 billion annually. Insurance premiums, already totaling more than $1 trillion a year, increase because customers -- not insurers -- absorb most of these losses. The National Insurance Crime Bureau claims that translates to $200 to $300 in added annual premiums per family.

Organized and independent insurance fraud is investigated on several levels by insurers, insurance regulators and local, state and federal law enforcement agencies. Fraud charges can be filed against defendants, who are policyholders or who work with or inside an insurance company. Examples of insurance fraud include falsified evidence or personal injury or property claims, staged motor vehicle accidents, disaster-related home repair schemes and inside jobs, like premium thefts.

The FBI was involved in 600 convictions for fraud of all types in 2011. The agency boasted about recovering $23 billion within a three-year period and convicting several high-profile company executives. But, investigators are not flawless – honest errors can be painted wrongly as acts with criminal purpose.

U.S. government investigators look for money trails that lead to evidence of fraud. Louisiana defendants convicted of insurance fraud may face criminal and civil penalties. Depending upon the charges involved, punishments for fraudulent activities can include high fines, asset forfeiture, orders of restitution and lengthy prison time.

Criminal defense attorneys concentrate on minimizing damage, even as they work toward securing a client's freedom, charge reductions and acquittals. Lawyers know accused parties can experience unfair personal, social and professional backlash, even before a fraud case is resolved.

Source: Federal Bureau of Investigation, "Investigating Insurance Fraud" Jan. 05, 2015

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