Insurance Fraud

New Jersey Insurance Fraud Law

N.J.S.A. 2C:21-4.6 makes it a crime to make or cause a false, misleading, fraudulent or fictitious statement of material fact to be made in conjunction with:

(1) a claim for payment, reimbursement or other benefit pursuant to an insurance policy, or from an insurance company or the “Unsatisfied Claim and Judgment Fund Law,” P.L.1952, c. 174 (C.39:6-61 et seq.);

(2) an application to obtain or renew an insurance policy;

(3) any payment made or to be made in accordance with the terms of an insurance policy or premium finance transaction; or

(4) an affidavit, certification, record or other document used in any insurance or premium finance transaction.

Penalties Under this Law. A violation of the Insurance Fraud Law results in a third degree crime, up to 5 years in prison and a fine that can reach $15,000. A charge is elevated to a second degree crime, however, if the five or more acts of insurance fraud were committed with an aggregate value or benefit of at least $1,000. The penalties for second degree insurance fraud include 5-10 years in prison and a fine of up to $150,000.

Elements of Proof. The prosecutor has the burden of proving three (3) elements in order to convict someone for violating N.J.S.A. 2C:21-4.6. First, the insurance transaction must have involved one of the four categories previously set forth (i.e. claim for payment…application to obtain…).  Second, the defendant must have made or caused a false, fictitious, fraudulent or misleading statement of material fact to be made. Third, the conduct of the accused must have been knowing.

New Jersey Insurance Fraud Prevention Act

The New Jersey Insurance Fraud Prevention Act is another law that is intended to attack this area of criminal activity.  The purpose of this law is to facilitate the detection and elimination of insurance fraud, as well as to ensure restitution so that the overall cost of insurance in the state is minimized. N.J.S.A. 17:33A-4 outlines that six (6) types of conduct that constitute a violation of this law and includes:

• False or misleading statements made in support of a claim or application for benefits;
• Concealing or failing to disclose an event that affects an individual’s right to payment or benefits; or
• Issuing or causing a certificate of insurance to be issued that contains false or misleading information, or conspiring in such conduct.

This statute also outlines more specific actions that constitute fraud such as misrepresenting in an application for car/automobile insurance that you are a resident of NJ or that a vehicle will be principally garaged in the state when, in actuality, this is not the case.

Automobile & Car Insurance Fraud

There are a number of basis under New Jersey Law for an automobile insurance fraud offense.

The first way to be charged is for making a material misrepresentation in conjunction with a claim for payment or benefits, or renewal of a car insurance policy. For example, it would be insurance fraud to claim that damage was caused by a hit and run driver when it was actually the result of a one-car accident. It would also constitute fraud to claim that pre-existing damage to a car was the result of a collision or to inflate a loss.

The second reason that someone would be charged with insurance fraud is for violating 2C:21-4.6b because of a claim that they either: (1) live in New Jersey or principally garage their car in the state when they actually reside in another jurisdiction; or (2) live in another state or principally garage their car in another state when their vehicle or residence is in New Jersey.

The third primary basis for an insurance fraud complaint involving a car, truck or other motor vehicle is violating the Automobile Insurance Cost Reduction Act by making a misrepresentation, false statement or proffering a fictitious document to obtain benefits, or by conspiring to do so.

Health Care Fraud

New Jersey has adopted a specific law contained at N.J.S.A. 2C:21-4.3 that is directed at health care claims fraud. Although this statute is primarily directed at “practitioners”, including someone licensed to practice medicine, chiropractic, psychology, optometry or even nursing, the law extends to those outside the profession.

A conviction for health care fraud can result in a third degree crime or second degree crime depending on the facts and circumstances of the violation.

• When a practitioner is convicted of knowingly committing health care fraud under 2C:21-4.3, it results in a second degree crime, 5-10 years in prison and a fine of up to $150,000.
• A practitioner who recklessly violates this law, or a non-practitioner who knowingly commits this form of insurance fraud, is guilty of a third degree crime punishable by up to 5 years in prison and a fine of up to $15,000.

Health care fraud also results in a right to restitution of the victim.

Other Forms of Insurance Fraud in New Jersey

Fraud can arise in just about any context in which a policy of insurance is issued in New Jersey. While the highest number of criminal complaints arise in the context of automobile and health insurance, there is a wide range of areas where someone can be charged. The following are some of the more noteworthy situations for insurance fraud:

The requirements in order to prove a charge for insurance fraud in any of these areas are largely the same. There must be a material misstatement or effort to withhold information that induces an insurer to make a payment or provide coverage.

Common Defenses to Insurance Fraud

Various defenses may be employed against the insurance fraud charge in New Jersey. These may include:

• Mistake of fact (your insurance claim was reasonable and legitimate)
• You did not knowingly make false statements on your insurance forms
• You made an effort to correct any inaccurate statements on your insurance forms
• The false statements were not material (see above for a definition of “material”)
• Statute of limitations has expired (the prosecution has waited too long and can no longer bring charges for this crime)
• Insufficient evidence to prove the elements of the crime
• Issues with police procedure and searches and seizures (your rights were violated during the police investigation, or evidence was improperly obtained and cannot be used at trial)

Insurance fraud is a potentially grave crime. Protect your rights. If you are charged with insurance fraud in New Jersey, contact an experienced and highly knowledgeable attorney right away, such as those at The Law Offices of Jonathan F. Marshall. They will help you analyze your options and develop a plan of defense.

Contact Our Highly Skilled NJ Insurance Fraud Defense Lawyers For Assistance

If you were charged with insurance fraud or are under investigation for this offense, enlisting the services of an experienced New Jersey criminal attorney is a must. The team of lawyers at our firm is accomplished in defending automobile, disability, Medicaid, disability, unemployment and other formers of this offense.  Whether you were arrested in Hudson County, Camden County, Burlington County, Somerset County, Atlantic County, Hunterdon County or elsewhere in NJ for submitting a fraudulent claim or application for insurance, you can assured that the Law Offices of Jonathan F. Marshall possesses a defense lawyer with the know-how to avoid a conviction.

For immediate assistance from one of our attorneys, you can call 855-450-8310 or fill out an online consultation form. A member of our staff is available 24/7 to assist you and initial consultations are always free of charge.

Frequently Asked Questions