New York Law
NY PENAL LAW criminalizes insurance fraud. What is that? It is the act of knowingly offering false written information in regard to any insurance contract to any insurer, self insurer, or purported insurer, or purported self insurer, or any agent.
This criminal act has certain penalties, depending on which degree the act falls into:
New York law defines several degrees of insurance fraud, each with specific criteria and penalties:
- Insurance Fraud in the Fifth Degree (N.Y. Penal Law § 176.10): A class A misdemeanor, committed when a person commits a fraudulent insurance act.
- Insurance Fraud in the Fourth Degree (N.Y. Penal Law § 176.15): A class E felony, committed when a person commits a fraudulent insurance act and wrongfully takes, obtains, or withholds property valued over $1,000 but not exceeding $3,000.
- Insurance Fraud in the Third Degree (N.Y. Penal Law § 176.20): A class D felony, committed when a person commits a fraudulent insurance act and wrongfully takes, obtains, or withholds property valued over $3,000 but not exceeding $50,000.
- Insurance Fraud in the Second Degree (N.Y. Penal Law § 176.25): A class C felony, committed when a person commits a fraudulent insurance act and wrongfully takes, obtains, or withholds property valued over $50,000.
- Insurance Fraud in the First Degree (N.Y. Penal Law § 176.30): A class B felony, committed when a person commits a fraudulent insurance act and wrongfully takes, obtains, or withholds property valued over $1 million.
- Aggravated Insurance Fraud (N.Y. Penal Law § 176.35): A class D felony, committed when a person commits a fraudulent insurance act and has been previously convicted of an offense involving a fraudulent insurance act within the preceding five years.
These statutes demonstrate the escalating severity of insurance fraud charges based on the value of property involved and prior convictions.
Federal Law
Under 18 U.S.C. § 1033, it is a federal crime to:
- Make false material statements or willfully overvalue property in insurance-related documents
- Embezzle or misappropriate insurance funds
- Obstruct insurance fraud investigations
Penalties can include substantial fines and imprisonment, with sentences varying based on the scale and severity of the fraud.