No Fault Insurance is a Formula For Insurance Fraud
Post 4703
GEICO, as a pro-active victim of insurance fraud, sued Jean-Pierre
Barakat, M.D., et al, alleging that Defendants defrauded GEICO in
violation of the Racketeering Influenced and Corrupt Organizations Act
("RICO," 18 U.S.C. § 1962(c), (d)), by submitting hundreds of fraudulent
bills for no-fault insurance charges. Plaintiffs also allege common law
fraud and unjust enrichment and seek a declaratory judgment as to all
pending bills.

In Government Employees Insurance Company, et al v. Jean-Pierre Barakat,
M.D. No. 22-CV-07532 (NGG) (RML), United States District Court, E.D.
New York (January 2, 2024) the USDC provided an injunction.

BACKGROUND

GEICO, faced with at least 43 allegedly fraudulent no-fault claims from
health care providers, moved for a preliminary injunction to stay all 43
pending no-fault insurance collection arbitrations commenced against
GEICO by or on behalf of Defendants.

In New York, an insurer is required to provide certain no-fault
insurance benefits ("No-Fault Benefits") to the individuals that they
insure ("Insureds"). No-Fault Benefits cover up to $50,000 of necessary
healthcare expenses that result from automobile accidents. These
benefits are provided to ensure that injured victims of motor vehicle
accidents have an efficient mechanism to pay for and receive the health
care services that they need.

Insurers are only given 30 days to review and investigate claims before
paying those claims to avoid risk of penalty for denying or delaying a
claim.

Operation of the Alleged Scheme

GEICO alleged that in 2021 Defendant Barakat was recruited by the John
Doe Defendants to participate in a complex fraudulent insurance scheme


Between February 15,2021 and March 3, 2022, Barakat and the John Doe
Defendants used Defendant Patriot Medical to bill GEICO and other New
York automobile insurers for an experimental treatment called ESWT.  
Moreover, Defendants submitted bills seeking more than

Evidence of the Alleged Scheme

In support of its fraud claims, GEICO has submitted a "representative
sample" chart, totaling 1,371 entries of allegedly fraudulent no-fault
claims submitted by the Barakat Practices. GEICO asserts that it has
paid at least $183,000.00 to the Barakat Practices in no-fault claims.

DISCUSSION

The showing of irreparable harm is perhaps the single most important
prerequisite for the issuance of a preliminary injunction, and the
moving party must show that injury is likely before the other
requirements for an injunction are considered. The harm must be shown to
be actual and imminent, not remote or speculative.

CONCLUSION

For the foregoing reasons, GEICO's motion to stay all pending no-fault
insurance collection arbitrations by or on behalf of Defendants Patriot
Medical and JPB Medical waive their obligation to post security were
granted.

ZALMA OPINION

GEICO must be honored for its proactive conduct against fraud
perpetrators since it appears the state of New York is not concerned
about fraud against insurers and will not prosecute the fraudsters.
Using RICO not only will allow GEICO to work to defeat the fraudulent
claims but will take the profit out of the crime by forcing the
fraudsters to pay the insurers for their fraudulent conduct. Other
insurers, facing the same fraud, should jump in with GEICO to make the
fraud perpetrators understand that they will lose their criminal profits
and may find they will pay the insurers more than they stole.

(c) 2023 Barry Zalma & ClaimSchool, Inc.

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