Allstate Files $5 Million Insurance Fraud Case in NY

HAUPPAUGE, N.Y., Nov. 4, 2011 /PRNewswire/ -- Allstate Insurance is seeking to recover more than $5 million from 21 New York-area defendants in its fifth insurance fraud lawsuit of 2011. The complaint, filed under the Racketeer Influenced and Corrupt Organizations Act ("RICO") and New York common law, alleges that 17 laypersons and lay entities illegally owned and controlled three professional acupuncture corporations and used them to submit fraudulent billing to Allstate. Since 2003, Allstate has filed 33 fraud lawsuits in New York, seeking nearly $180 million in damages.

According to the Insurance Information Institute, the state of New York is in an insurance fraud crisis and no-fault fraud is costing New Yorkers hundreds of millions of dollars year-after-year. "In essence, honest, hardworking New Yorkers are paying a 'fraud tax,'" said Krista Conte, spokesperson for Allstate's New York office. "We need lawmakers to enact meaningful insurance reform that puts the citizens of New York first."

As detailed in the lawsuit, Allstate contends that professional service corporations were actually owned and controlled by laypersons, rather than by licensed professionals. In addition, the lawsuit alleges that the defendants submitted or facilitated the submission of claims for acupuncture services through professional corporations that were never eligible to collect no-fault insurance benefits. The suit contends that Points of Health Acupuncture, P.C., Altercare Acupuncture, P.C., and Eastern Star Acupuncture, P.C. were fraudulently incorporated through a scheme using the name of a licensed acupuncturist, Anatoly Yuryev, and that Vladimir Sirota, Igor Belyansky, Ella Sushevich, Yaroslav Kotlovskiy, Svetlana Kotlovskiy, Igor Tsimmerman, Gennadiy Belzer, Hadley Benoit, Vlad Management Group, L.L.C., Regional Marketing, Inc., Tristate N.Y. L.L.C., Atlantis N.Y. L.L.C., KYDS L.L.C., ITA Family, L.P., Conduit Consulting L.L.C., LGB Corp., and Queens Brook Management Co., Inc., none of whom were licensed to practice acupuncture or operate an acupuncture practice, secretly owned and controlled the professional corporations.

Allstate is joined by other insurers and many New York State leaders in its pursuit for comprehensive reform of the no-fault system.  "The no-fault system is being exploited and responsible citizens are the victims," Conte said. "Without the support of lawmakers, incidents of fraud will continue to increase. We need to work together to fix the broken no-fault system."

The lawsuit was filed following an investigation by Allstate's Special Investigative Unit and seeks reimbursement for personal injury protection benefits Allstate paid on behalf of its customers during timeframes specified in the lawsuit.  The lawsuit is the latest in a string of actions taken by the insurer to protect consumers from these and similar activities.

For more information on the dangers of insurance fraud, and how you can help fight it, please visit Fraud Costs NY.

The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer known for its "You're In Good Hands With Allstate®" slogan. Now celebrating its 80th anniversary as an insurer, Allstate is reinventing protection and retirement to help nearly 16 million households insure what they have today and better prepare for tomorrow. Consumers access Allstate insurance products (auto, home, life and retirement) and services through Allstate agencies, independent agencies, and Allstate exclusive financial representatives in the U.S. and Canada, as well as via and 1-800 Allstate®.

SOURCE Allstate Insurance Company