Forging an Insurance Company Check is not Insurance Fraud

Some Wisdom from the Pennsylvania Supreme Court About Insurance Fraud

The Supreme Court of Pennsylvania has a sense of humor which surfaced in this unusual case from 2011.

Daniel Goodson’s car was in a collision.  His insurer totaled the aging New Yorker, then made a just division of the value of the insurance claim, sending $6,289 to the lender; the balance of $135, to appellant they made tender. And thus the matter terminated, or so one might have thought, but that was not to be, when Goodson’s later schemes were caught.

Goodson was unhappy with his meager share so six months later, in July, Mr. Goodson appeared at a branch of First National Bank, and there he made it cleart  hat he’d a check made out to him, which he innocently presented to open a new bank account—“from State Farm,” he represented.

The check was numbered familiarly, same as the prior one for $135 that he’d been given when this saga had just begun. And it was for $6,289, a unique and memorable amount. The bank obligingly took the check and opened a new account.

In Commonwealth of Pennsylvania v. Daniel Goodson, III, Supreme Court of Pennsylvania, 33 A.3d 611 (Dec. 21, 2011) the Supreme Court noted that never thinking that appellant’s check might have a minor flaw (like perhaps being a forgery), it allowed him to withdraw several thousand dollars and, days later, a few thousand more; he’d taken over $5,000 before the bank would learn the score. There was no evidence Goodson seemed the least bit nervous, having picked a branch with such unmatched customer service.

Of course the crime soon came to light, as agents of State Farm refused to pay the check he’d forged, which forestalled further harm: “’It’s not from us, there is no claim, the check we cannot honor!’ And appellant’s scheme was thus undone—he knew he was a goner. When braced, he paid the money back, a mitigating solution, but despite this act, the Commonwealth commenced its prosecution.”

Convicted of the forgery, insurance fraud, and theft, he admits the first and last, but denies the charge that’s left. He claims the sentence for insurance fraud is most certainly amiss—he says “I may be guilty, but I’m just not guilty of this. My sentence is inappropriate—undo the wrongful conviction.” And in the end, seeks this relief from our appellate jurisdiction.


Upon reviewing what Goodson did it did not take the Supreme Court long to see his argument was legally sound, its merits clearly true, and so it fell to the Supreme Court to expeditiously undo the sentence for insurance fraud because the elements just weren’t made out.

The Supreme Court concluded the elements of the statute are not proved in Goodson’s case. No insurance claim was instituted, by writing or face-to-face. Goodson gave nothing to an insurer, and what he gave the bank exec was neither “statement” nor “insurance claim”—it simply was a check. That’s not to say appellant’s acts are free from any blame, it’s just they’re neither part nor parcel of an insurance claim.

The prosecution says the check is linked “inexorably” to the January claim, by check amount, its number, and payee. Though such particulars indicate some shared genealogy ‘tween January and July, still they’re branches of a different tree. His first claim was legitimate and, resemblances not withstanding, he later passed a counterfeit check, no insurance coverage demanding.

Just because the bogus check shows an insurance company’s name doesn’t make the crime insurance fraud—it’s simply not the same. A check may seem a statement that State Farm owed him the dough but that assumption by the bank isn’t false insurance info, or evidence that’s material to a claim involving State Farm—there’s no new claim and the old claim’s gone—this was a different harm.

Because he made no insurance claim, nor a proffer to an insurer, he didn’t commit insurance fraud, and neither judge nor juror can to the contrary rightly find, even if they’d like to. Two crimes are are such that he’s not going to walk.

Slipping into poetry the Supreme Court concluded: “Sentenced on the other crimes, he surely won’t go free, but we find he can’t be guilty of this final felony.” The case must be remanded for resentencing, so the trial judge may impose the result he originally had in mind. What Goodson did is serious, but doesn’t comprise this crime—there’s simply no rhyme nor reason for it.


Insurance fraud is a serious crime. It requires punishment when proved. However, passing a false check purportedly issued by an insurer is not insurance fraud it is counterfeiting and fraud on the bank, nothing more. I speak on this case also because it is good for the old lawyer in me to see a court rule on a very serious case with a little humor as well as appropriate legal reasoning. Justice Marston, who wrote the opinion, deserves a thank you for giving me a little pleasure in this, the third month of the plague.

© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at and

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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