Thieves Compensation

True Crime Stories of Insurance Fraud Number 29

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Barry Zalma, Esq., CFE presents videos so you can learn how insurance fraud is perpetrated and what is necessary to deter or defeat insurance fraud. This Video Blog of True Crime Stories of Insurance Fraud with the names and places changed to protect the guilty are all based upon investigations conducted by me and fictionalized to create a learning environment for claims personnel, SIU investigators, insurers, police, and lawyers better understand insurance fraud and weapons that can be used to deter or defeat a fraudulent insurance claim.

He was a good employee. He arrived for work every day on time. He did his job eight hours a day and never goofed off. He was loyal to his employer. His diligence got him raises and promotions.

In 2009 his boss came to him and said: “The recession has hit me hard. I can’t afford to keep paying you. You are laid off.”

He was shocked. He could say nothing. He could do nothing to keep his job. He packed up his personal belongings, said “goodbye” to his boss and left.

The next day, he went to the state office of unemployment. He filed the first claim in his life for unemployment benefits. He was ashamed, but had no choice.

Coming out of the unemployment office he met a pleasant man. Having nothing better to do, he accepted the man’s offer of a cup of coffee. They sat on a bus bench and talked about his troubles.

The man asked detailed questions about his job. He explained that the employer was not alone. Other people were suffering just like he was. He explained there was a way to tide him over better than unemployment insurance.

The employee was dumbfounded.

“Are you offering me a job?” he asked.

“No. I am only offering a way to make yourself some money without any effort.”

The solicitor outside the unemployment office received a flat $500 fee from the lawyer. The doctor, who billed $600 for the complete examination and evaluation, gave the lawyer $200 as the lawyer’s fee for the referral. Everybody did very well except the workers’ compensation insurer and the employer whose business was having enough difficulties without finding its workers’ compensation premiums increased.

The employee received a bonus on top of his unemployment benefits that was sufficient to carry him into his new job with a small nest egg.

Rather than burning a building, the person committing insurance fraud merely signs his name to a claim form. Although most insurance fraud is not a violent crime, the crime of insurance fraud has become so rampant that a task force akin to the one used to quell the Los Angeles riots of 1992 and 2019-2020 riots is needed. That such a task force was not generated after the 1992 riots I doubt it will be started after the 2020 riots and Presidential election.

© 2022 – 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 practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business.

Subscribe to “Zalma on Insurance” at and “Excellence in Claims Handling” at

You can contact Mr. Zalma at,, and . Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

You may find interesting the podcast “Zalma On Insurance” at;  you can follow Mr. Zalma on Twitter at; you should  see Barry Zalma’s videos on; or videos on Go to the Insurance Claims Library – The last two issues of ZIFL are available at 

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