Investigation leads to regulatory action against insurance agent

DISB recently conducted an investigation, held a hearing and issued an order resulting in a non-resident insurance agent being suspended for a period of three months. The agent was ordered to make reimbursement to a surety insurer in the full amount of $20,000; and to make restitution to a brokerage firm in the amount of $30,000. DISB took the action because the producer/agent failed to repay bond monies for unearned commissions.

DISB and NICB to Combat Crime

In July, DISB met representatives from the National Insurance Crime Bureau (NICB) to coordinate an initiative in Washington, DC, to combat auto insurance and medical provider fraud. NICB will hire three new investigators in the DC area and they will be available to support DISB insurance fraud investigations.

FBI Tips on Avoiding Charity Fraud

In recent months, several natural disasters throughout the world—including floods, earthquakes, severe storms, tornadoes, and wildfires—have devastated lives and property. In the wake of these events, which cause emotional distress and great monetary loss to numerous victims, individuals across the nation often feel a desire to help by offering charitable donations. However, these tragic incidents have also prompted criminals to take advantage of this good will by illegally soliciting contributions while claiming to represent legitimate charitable organizations.
The Federal Bureau of Investigation recently provided the following tips for consumers wishing to make contributions:

• Do not respond to unsolicited (spam) email.
• Be skeptical of individuals representing themselves as officials soliciting via email for donations.
• Do not click on links contained within an unsolicited e-mail.
• Be cautious of email claiming to contain pictures in attached files, as the files may contain viruses. Only open attachments from known senders.
• To ensure contributions are received and used for intended purposes, make contributions directly to known organizations rather than relying on others to make the donation on your behalf.
• Validate the legitimacy of the organization by directly accessing the recognized charity or aid organization's website rather than following an alleged link to the sit e.
• Attempt to verify the legitimacy of the non-profit status of the organization by using various Internet-based resources, which also may assist in confirming the actual existence of the organization.
• Do not provide personal or financial information to anyone who solicits contributions: providing such information may compromise your identity and make you vulnerable to identity theft.

If you have received a scam email please notify the Internet Crime Complaint Center (IC3) by filing a complaint at ic3.gov. For more information on e-scams, please visit the FBI’s New E-Scams and Warnings web page.

DISB Releases Consumer Alerts on Health Insurance

DISB recently released several consumer alerts on health insurance, geared mainly toward seniors.
Among them was an overview of Medicare and predatory sales practices. DISB encourages Medicare beneficiaries to make informed decisions without being pressured into choosing a Medicare policy.

Medicare, the federal health insurance program for people 65 and older, or those of any age with disabilities, allows individuals to enroll through the Social Security Administration. Many choose private plans to supplement the benefits that Medicare does not cover. Other individuals purchase a private plan called Medicare Advantage.
DISB is warning seniors that while most agents that sell Medicare products are honest, there are some who sell Medicare Advantage policies using questionable tactics to sell the products such as removing beneficiaries from traditional Medicare without their knowledge; misleading beneficiaries to believe that there will be no new costs and that their doctors or hospitals will accept their plan; and enrolling beneficiaries in plans they cannot afford.
The alert warns seniors of the predatory practices in the sales of Medicare products as outlined below:

• Be cautious about people claiming to work for Medicare. Representatives for Medicare do not make home visits or solicit sales by telephone.
• If a person comes to your home without being invited, do not let them in your house.
• Do not listen to people who say Medicare is free. Premiums are paid for the health insurance product.
• Be leery of a person who says enrollment in Medicare Advantage will not affect Medicare. This is not true.
• Do not switch plans immediately because an agent tells you that your plan’s rates are going to increase.

DISB works for consumers to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. For more information on this alert and other consumer issues, visit DISB’s Web site at disb.dc.gov or call (202) 727-8000. To file a complaint with the federal government’s Medicare Appeals and Grievance program, go to medicare.gov/basics/appeals.asp or call 1-800-Medicare (1-800-633-4227).

DISB in the Community

DISB’s Financial Fraud Awareness Week, August 10 to August 17

Juliana Tengen, a fraud investigator in DISB’s Enforcement and Investigation Bureau, does a presentation on financial fraud for the members of the Hillcrest Community Civic Association in Ward 7 on August 2, as a precursor for DISB’s Financial Fraud Awareness Week, August 10 to August 17. The Metropolitan Police Department PSA 606 hosted the third annual Neighborhood Watch Crime Prevention and Safety Seminar, where residents learned about preventing auto theft and other crimes. This event usually coincides with the MPD’s National Night Out in early August.

Upcoming Events Financial Fraud Awareness Week 2008—Week of August 10 to August 17. This is aimed at raising District residents’ awareness on scams, how to protect themselves and where to report scams to help protect others. DISB has launched its information-driven campaign with a proclamation from Mayor Adrian M. Fenty to declare the fight against financial fraud by increasing consumer awareness and reducing risk. DISB will send out tips on different types of fraud, how to recognize financial fraud, and how to fight against it. DISB staff will be giving away information on fraud in select areas in the District of Columbia.  Fraud Presentation—Tuesday, August 12, 6 pm - 8 pm, HOPE Center, 2509 Good Hope Road, SE. DISB will make a presentation on avoiding financial scams and how to report fraud to the agency at Operation Hope’s budgeting workshops. This event is sponsored by Operation Hope. Elderfest 2008 —Thursday, September 4, 10 am to 3 pm, Freedom Plaza (between 13th & 14th Streets, NW). DISB will have an exhibit booth for staff to talk to seniors and distribute information on our services. This is sponsored by the DC Office on Aging. Senior Presentation—Tuesday, September 9, 11:30 am to 12:15 pm, St. Georges Episcopal Church, 160 U Street, NW.  DISB will present to seniors on financial scams. This is hosted by St. Georges Senior Club Ministries Meeting. Education Expo—Saturday, September 13, 9 am to 4:30 pm, McKinley Tech High School, 151 T Street, NE. Agency representatives will attend the 2008 DC Family Education Expo to discuss services and resources that DISB provides to residents. Topics include financial scams and reporting fraud to the agency. This is sponsored by the Office of the State Superintendent of Education. H Street Festival —Saturday, September 20, 9 am to 7 pm, H Street between 12th and 14th Streets, NE. DISB will have a booth set up so staff can distribute information on our services, as well as answer questions. This is organized by the H Street Merchants and H Street Main Street. Annual Health Fair—Saturday, September 20, 9 am to 3 pm Mt. Pleasant Baptist Church, 215 Rhode Island Avenue, NW. DISB will be discussing the services and resources the agency provides to consumers. Topics include investor education and protection, predatory and payday lending, investment schemes and fraud. This is sponsored by the Mt. Pleasant Baptist Church. For additional updates, select the agency calendar on disb.dc.gov.

DISB Involved in HealthMarkets Settlement

DISB recently participated in a multi-state settlement agreement with HealthMarkets. The District will receive a $122,300 penalty from HealthMarkets, based on the agency’s participation in HealthMarkets’ national market conduct examination. HealthMarkets’ regulatory plan of corrective action requires various operational standards be met in the near future. Failure by HealthMarkets to meet its agreed improvement standards would result in additional monetary penalties being assessed.

Senior Resident Defrauded

The Metropolitan Police Department has joined forces with DISB’s Enforcement and Investigation Bureau to investigate a mortgage and credit card fraud against an individual under the care of Adult Protective Services. The ownership of the victims’ District home was fraudulently transferred by forging the deed document. Additionally, $30,000 in fraudulent credit card charges were made against the victims account. This case is ongoing.