Asset Diversion Explained by a NY Insurance Fraud Lawyer
Asset diversion is a form of fraud that occurs when the assets of an insurance company are improperly diverted. Insurers obtain fu nds through premium payments and should pay out covered claims to policyholders. If assets are diverted, the insurance company may be bankrupted or unable to meet its financial obligations. The state’s guarantee fund may need to step in and protect policyholders.
Because asset diversion can cost policyholders, shareholders, and the state, there are serious criminal consequences if you are found guilty of this crime. You can expect to face aggressive prosecution and you need to work as hard to defend yourself as the prosecutors are working to get you jailed. Having a top legal advocate on your side is the best way to fight for your freedom. Bukh Law Firm, PLLC has the reputation and experience necessary to fight for you after an accusation of asset diversion is made.
What is Asset Diversion?
Assert diversion is the term that the Federal Bureau of Investigation uses to describe the theft of assets belonging to an insurance company. Instead of the funds an insurer has in reserve being used to pay claims, and instead of shareholders benefitting from insurance company profits, those involved in the fraud scheme are able to take the assets that the insurer owns. This is a complex form of theft that often involves complicated financial transactions.
How Does Asset Diversion Work?
Asset diversion typically occurs when an insurer is acquired or when two insurance companies merge.
In a typical asset diversion scheme, borrowed money is used to acquire a controlling interest in the insurance company. Once the acquisition is completed, the debt is paid off using assets from the acquired company. Any remaining assets the insurance provider owns can then be diverted to the purchasers. In some cases, the insurer continues to operate and generate additional premiums that are also later diverted. Arkady Bukh has a long track record of representing clients accused of serious federal and state crimes in NYC TOP RATED ON: SUPER LAWYERS, AVVO, NATIONAL TRIAL LAWYERS
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Arkady Bukh has a long track record of representing clients accused of serious federal and state crimes in NYC
TOP RATED ON: SUPER LAWYERS, AVVO, NATIONAL TRIAL LAWYERS
Asset diversion can occur with any type of insurance company, including health insurance providers, life insurance providers, home insurance providers, and auto insurance providers. Anyone involved in the scheme, including those who applied for the loans, developed the scheme, or diverted the assets, can be held accountable for the crimes committed by all co-conspirators to the insurance fraud crime.
Penalties for Asset Diversion
Asset diversion can lead to state or federal criminal charges, depending upon the specifics of the scheme that was involved. 18 U.S.C. Section 1347, for example, is a federal law that applies when attempts are made to obtain any money or property of a health care benefit program using false statements, false pretenses, or misleading statements. If serious bodily injury occurs as a result of the fraud, this type of fraud could result in a maximum sentence of 20 years imprisonment. Even in a simple case of health care fraud with no injuries as a result of the scheme, the maximum penalty is a decade of incarceration.
There are other federal and state crimes you could be charged with for involvement in an asset diversion scheme, including money laundering, bank fraud, mail fraud, wire fraud, larceny, or embezzlement.
Bukh Law Firm, PLLC provides legal representation to clients facing state criminal charges, federal criminal charges, as well as civil actions by shareholders or government authorities trying to recover funds that were allegedly obtained through fraud.
Contact a NY Insurance Fraud Lawyer in Asset Diversion Cases
Asset diversion cases can be very complicated and it is often difficult for prosecutors to get a jury to follow the paper trail and understand why the acquisition and subsequent use of assets was illegal. When a prosecutor doesn’t succeed in proving beyond a reasonable doubt that you improperly diverted assets, you shouldn’t be found guilty of a crime.
At Bukh Law Firm, PLLC, we work very hard to help clients avoid conviction by raising defenses or introducing doubt into the minds of jurors hearing the case. We understand complex financial transactions in mergers and acquisitions and we know how the insurance industry works. Give us a call so we can help you to fight for your freedom when accused of asset diversion insurance fraud in New York.