Crime Doesn’t – Pay it Costs

“Runner” Must Pay Restitution to Insurers

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The Eighth Circuit was called upon to decide the amount of restitution owed by a participant in a recruitment-and-kickback scheme aimed at defrauding automobile-insurance companies. The district court ordered restitution for every chiropractic patient that Abdisalan Hussein recruited from 2013 onward.

In United States of America Plaintiff v. Abdisalan Abdulahab Hussein, also known as Abdisalan A. Hussein, No. 22-1275, United States Court of Appeals, Eighth Circuit (August 23, 2023) the Eighth Circuit resolved the dispute.


Hussein ended up at a Twin Cities chiropractic clinic after an automobile accident. The visit resulted in a job: the clinic hired him to recruit patients. And then another one did too.

Hussein’s role was to bring in as many accident victims as possible. Each new patient could undergo treatment up to $20,000, the limit of basic economic benefits available under most Minnesota automobile-insurance policies. In return, Hussein received a kickback of up to $1,500, a portion of which he shared with patients who returned for multiple visits.

The U.S. Government started “Operation Backcracker,” targeting insurance fraud. If Hussein “qualified as [a] ‘runner’ [under Minnesota law], then insurers had no obligation to reimburse the clinic[s] for any services provided.” After a jury trial, the district court ordered Hussein to pay restitution to the insurance companies he defrauded. He complained, alleging he was not a “runner.” Because of Minnesota statutory law, the Eighth Circuit explained that not all recruiters are runners and restitution only applied to runners.

On remand, the amount of restitution decreased. This time, the district court concluded that Hussein qualified as a runner for only 53 of the 65 victims, which dropped the award to $155,864. Hussein, for his part, has adopted an all-or-nothing strategy: he does not believe he owes a single penny of restitution.


The linchpin of Hussein’s argument is that he was never a runner.

Once runners are involved, it taints the relationship and automatically relieves insurers of their duty to pay. In statutory terms, once a runner recruits someone, every health-care service provided afterward becomes “non-compensable and unenforceable as a matter of law.”

A runner is someone who “directly procures or solicits prospective patients” for “pecuniary gain” and “knows or has reason to know that the provider’s purpose” is to “obtain . . . benefits under or relating to” an automobile-insurance contract. Hussein had an active role in recruiting accident victims. He also helped coach patients to deceive insurance companies all in an effort to line his own pockets.

The trial record completes the picture. Hussein received up to $1,500 per patient he recruited, which satisfies the pecuniary-gain requirement. A series of text messages establishes the remaining elements. In one, Hussein texted with a clinic owner about how one patient was “a piece of shit” for not coming to enough appointments.

The Eighth Circuit concluded that Hussein “directly procure[d]” these patients with at least a “reason to know,” if not actual knowledge, that the provider’s purpose was to obtain benefits under an automobile-insurance contract.

The problem for Hussein is that the government met its ultimate burden of proving the loss. In a fraud case, the government bears the burden of proving a prima facie case that each victim was entitled to restitution, and the defendant bears the burden of rebutting it.

One patient who testified that she called him about chiropractors even though she did not know him while he referred to another as “a piece of shit” for ending her visits. Neither were friends. And it goes without saying that being a “helpful person” in the Somali community does not transform every interaction into one “made in a social setting.”

The judgment of the district court was affirmed


The crime of insurance fraud is destroying the ability of the insurance industry to serve the public and make a small profit. “Runners” called “cappers” in other states are the first level of many insurance fraud schemes. Hussein used his involvement in the Minnesota Somali community to allow unscrupulous medical providers to defraud insurers. The court, applying the strange Minnesota statute required Hussein to make restitution to most of the insurers he defrauded and put a small dent in auto insurance fraud in Minnesota. One can only hope they also convicted the health care providers and made them pay restitution as well.

(c) 2023 Barry Zalma & ClaimSchool, Inc.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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