Health: AllState sues for USD5m from alleged unauthorised practitioners

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 USD180 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, spokesman for Allstate's New York office.

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.

It is alleged 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 practise acupuncture or operate an acupuncture practice, covertly owned and controlled the professional corporations.