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New York Insurer Files RICO Suit Alleging Multi-Million Dollar Insurance Fraud Scheme
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A New York specialty insurance underwriter, Roosevelt Road Specialty, has initiated a federal lawsuit against a New York City personal injury law firm and numerous medical providers, accusing them of orchestrating a widespread scheme to defraud insurers. The alleged fraud involved staged construction accidents and the provision of fraudulent medical treatments to inflate insurance claims.
Details of the Insurance Fraud Lawsuit
The 162-page Racketeer Influenced and Corrupt Organizations Act (RICO) action, filed in the Eastern District of New York on June 16, marks the fifth such legal action roosevelt Road Specialty and its reinsurance program, Tradesman Program Managers, have undertaken as March 2024 [[1]]. The complaint names William Schwitzer & Associates, P.C., its principals William Schwitzer and Giovani Merlino, and dozens of medical professionals as defendants.
The lawsuit alleges that the defendants conspired to recruit construction workers, many of whom were undocumented, to stage or exaggerate workplace injuries. These workers were then allegedly referred to complicit clinics for unnecessary and invasive medical procedures, including surgeries, to inflate personal injury and workers’ compensation claims.
Did You Know? The FBI estimates that insurance fraud costs the United States more than $40 billion per year.
Key Allegations and Defendants
The complaint states that the scheme operated from at least 2018, with a “marked escalation” since 2020. The defendants include 30 medical practices specializing in orthopedics, radiology, pain management, and acupuncture. Ten of these defendants, including Brooklyn Medical Practice and Big Apple Pain Management, allegedly operated from the same address at 410 Ditmas Ave.in Brooklyn, described as a hub for fraudulent referrals and treatments.
Tradesman CEO Daniel Hickey Jr. stated, “This lawsuit shines a light on a scheme that targeted vulnerable individuals and defrauded insurers of millions of dollars.”
the suit further alleges that “persons of unknown citizenship” were involved in recruiting construction workers to stage accidents at various construction sites throughout New York.
How the Scheme Allegedly Worked
According to the complaint, the Schwitzer defendants, through runners, directed claimants to associated medical providers who were aware of the fraud. These providers allegedly supplied documents attesting to the workers’ alleged accidents and injuries. These documents were then submitted with workers’ compensation and general liability claims to seek reimbursement for medical expenses and indemnity payments. The lawsuit contends that the strict nature of New York’s workers’ compensation and labor laws frequently enough facilitated the success of these demands.
Similar Insurance Fraud Lawsuits
Roosevelt Road and Tradesman filed a similar RICO lawsuit in January 2025 targeting the Liakas Firm and its managing partner, Dena Liakas. They also filed three suits in 2024. Other entities have also taken legal action against alleged insurance fraud networks.
Earlier in 2025, Uber Technologies Inc. filed a racketeering lawsuit against law firms, doctors, and pain-management clinics, alleging staged car accidents and unnecessary surgeries to exploit New York’s no-fault insurance policies [[2]].
In 2024, American Transit Insurance Co. (ATIC), New York’s largest taxi insurer, filed a lawsuit seeking over $450 million from medical providers allegedly involved in a massive fraud scheme [[3]]. Additionally, Ionian RE, along with three construction contractors, alleged a large-scale New York fraud scheme involving staged workplace accidents and bogus workers’ compensation lawsuits [[4]].
Pro Tip: Businesses can protect themselves from insurance fraud by implementing robust internal controls, conducting thorough background checks, and reporting suspicious activity to the authorities.
| Entity | Allegations | Year Filed |
|---|---|---|
| Roosevelt Road Specialty | Staged construction accidents, fraudulent medical treatments | 2025 |
| Uber Technologies Inc. | Staged car accidents, unnecessary surgeries | 2025 |
| American Transit Insurance Co.(ATIC) | Massive medical provider fraud scheme | 2024 |
| Ionian RE | Staged workplace accidents, bogus workers’ compensation lawsuits | 2024 |
Understanding Insurance Fraud: A Broader Context
Insurance fraud is a pervasive issue that affects various sectors, including construction, transportation, and healthcare. These schemes not only result in financial losses for insurance companies but also drive up premiums for businesses and individuals. The involvement of organized networks and the exploitation of vulnerable individuals further exacerbate the problem.
The rise in fraudulent activities has prompted insurers and law enforcement agencies to intensify their efforts in detecting and prosecuting these schemes. RICO lawsuits, like the one filed by roosevelt Road Specialty, are increasingly being used to target the organized networks behind these fraudulent operations.
Frequently Asked Questions About Insurance Fraud
- What are the common types of insurance fraud?
- Common types include staged accidents, inflated medical bills, false claims, and premium fraud.
- How can I report suspected insurance fraud?
- You can report it to your insurance company, state insurance fraud bureau, or the National Insurance crime Bureau (NICB).
- What are the penalties for insurance fraud?
- Penalties can include fines, imprisonment, and restitution, depending on the severity of the fraud.
- How do insurance companies detect fraud?
- They use data analytics,surveillance,and investigations to identify suspicious patterns and activities.
- What role do medical providers play in insurance fraud?
- Some providers may participate by billing