S988A-2011 Actions

• Jan 30, 2012: PRINT NUMBER 988A
• Jan 30, 2012: AMEND (T) AND RECOMMIT TO INSURANCE
• Jan 4, 2012: REFERRED TO INSURANCE
• Jan 5, 2011: REFERRED TO INSURANCE

S988A-2011 Memo

BILL NUMBER:S988A            REVISED 02/02/12

TITLE OF BILL:
An act
to amend the insurance law, the financial services law,
the executive law, the state finance law,
the penal law, the civil practice law and rules and the vehicle and
traffic law, in relation to
insurance fraud; to establish the temporary task force on motor vehicle
insurance fraud; and providing for the repeal of certain provisions upon
the expiration thereof

PURPOSE:
The purpose of this bill is reduce the incidence of auto insurance
fraud including fraud committed by those who misrepresent where they
live, operate their automobile, and garage such vehicle for insurance
coverage purposes. By misrepresenting where such automobile operators
truly live and operate their motor vehicle, these persons obtain
inappropriate reductions in their auto insurance premium rates and
such costs are shifted to other law abiding automobile owners.

SUMMARY OF PROVISIONS:
Section 1: Adds a new Insurance Law section 401{d) to explicitly
expand the authority of the superintendent of Insurance, under the
Insurance Fraud prevention Article, to investigate fraudulent
activities with regard to motor vehicle operators who have not
secured automobile insurance coverage or who misrepresent the
principle place where such automobiles are garaged and operated.

Section 2: Amends Insurance Law section 405{a) to authorize the
Insurance Frauds Bureau to accept reports of suspected fraudulent
insurance transactions from any self insurer with regard to health
insurance coverage, motor vehicle liability coverage, or workers
compensation coverage.

Section 3: Adds a new Insurance Law section 405-a to be included
within Insurance Fraud prevention Article of the Insurance Law. This
new section allows members of the general public, if they believe
that a fraudulent insurance act has been committed or is about to
take place to report such activity or transaction to the Attorney
General, local District Attorney or the Insurance Fraud Bureau of the
Insurance Department. If the Insurance Frauds Bureau recommends to
the Attorney General or local District Attorney to Commence an
enforcement action or the Attorney General or District Attorney
commences an action based on the information provided by the member
of the general public, then such person is entitled to receive a cash
award. The award can be up to 15% of the proceeds of the action or
settlement not to exceed $ 25,000. The court shall base such award
decision on the extent such person substantially
contributed to the prosecution of the action.

Section 4: Amends Insurance Law section 2133 to expand the scope of
prohibition for any insurance company, insurance agent, broker, or
other person who knowingly possesses, transfers or uses a forged
insurance identification card to also include other false insurance
documents which purports to evince insurance coverage when it is not
in effect or is at limits less than those stated on the document.

Section 5: Amends Financial Services Law section 405 to add the
Attorney General and District Attorney to the class of agencies that
are included within the purview of this section of the law.

Section 6: Adds a. new Executive Law 231 to establish the Insurance
Fraud Reward program under the supervision of the State police. This
section establishes a state-wide Insurance Fraud Reward Program to
pay awards to persons who provide information that leads to the
arrest and conviction of persons guilty of fraudulent insurance
acts. The superintendent of police shall establish a toll-free
hotline and website to collect tips and information from the general
public to assist the State police in the investigation and
prosecution of insurance fraud crimes.
Awards from $ 1,000 up to $ 5,000 can be paid for information leading
to the arrest and conviction of insurance fraud crimes. The State
police shall obtain money to finance this award program from the
State police Motor vehicle Law Enforcement Account. Money from this
account is received in part from surcharges levied on all motor
vehicle insurance policies issued in New York pursuant to Insurance
Law section 9110.

Section 7: Amends Executive Law section 846-m(2) (a) to provide that
at least 1/4 of the money received by the State police Motor Vehicle
Law Enforcement Account (collected from a surcharge placed on all
auto insurance policies sold in New York to combat auto insurance
fraud) after January 1, 2011 shall be used to support activities
undertaken by local District Attorney's to combat auto insurance fraud.

Section 8: Amends State Finance Law section 97-mm(3), the State police
Motor Vehicle Law Enforcement Account, to authorize funds to be used
for the Insurance Fraud Reward Program established pursuant to
Executive Law section 231.

Section 9: Amends State Finance Law section 97-mm(4) to"require that
the State police Annual Auto Theft Prevention Report also include its
efforts to curb automobile insurance fraud.

Section 10: Amends Penal Law section 170.10 to add a new (6) to the
list of documents that the forgery of is considered to be forgery in
the Second Degree. The new document that, if forged, would be forgery
in the Second Degree are certificates of insurance or an insurance
identification card.

Section 11: Amends Penal Law section 170.15 (Forgery in the First
Degree) to include as forgery in the first degree, the fraudulent

making, completion, or alteration of 10 or more written instruments
such as certificates of insurance or insurance identification cards.

Section 12: Adds a new Penal Law section 175.50 to make it a class E
felony to offer a false application for motor vehicle insurance or
registration. Under this provision, anyone who submits to the
Department of Motor Vehicles or to an auto insurer (to obtain an auto
insurance policy or insurance identification card) any document that
contains a false statement or information with regard to where such
applicant resides or where such applicant's motor vehicle is garaged
or operated and such document is used directly or indirectly to
register an automobile shall be a class E felony.

Section 13: Amends Penal Law section 176.05 which defines the term
"insurance fraud". Under this bill, the term "insurance fraud" is
expanded to include any false document used to secure either
insurance coverage, file an insurance policy claim, or obtain payment
for personal lines insurance coverages (Le. auto and homeowners
insurance). Under current law, only false documents that are used to
secure commercial lines policies or money for claims against a
commercial lines policy (i.e general liability or business property
policies) are considered to be insurance fraud. This bill expands the
types of insurance policies that persons cannot lie about to obtain
coverage or claims payment to include personal lines coverages such
as motor vehicle liability or homeowners insurance.

Section 14: Amends Penal Law section 176.15 to expand the scope of
insurance fraud in the 4th degree to include the operation of a motor
vehicle on a public highway when such operator is insured by a policy
issued under the laws of another state, but such person in fact
principally lives and garages their vehicle in New York.

Section 15: Amends CPLR section 1310(4-b) to include within the
definition of "specified felony offense" the conviction of a person
of crimes of Insurance Fraud pursuant to Article 176 of the Penal
Law. CPLR Article 13-A (of which section 1310 is the definitions
section of this Article) lays out the procedure to seize ill-gotten
profits from criminal activity. Hence, illegally secured profits
obtained by persons from fraudulent insurance acts can be seized and
used for other law enforcement purposes.

Section 16: Amends CPLR section 1311(3-a} to add the commission of
crimes of insurance fraud to the list of crimes in which forfeiture
actions may be taken to seize illegally secured assets or fruits of
the crime.

Section 17: Amends CPLR section 1311(11} to give the Insurance Frauds
Bureau notice of a forfeiture of assets proceeding and stipulation or
settlement agreement of such action which is based on a felony of
insurance fraud.

Section 18: Amends CPLR section 1349(4} which deals with the disposal
of property obtained from a criminal activity forfeiture action so
that the Insurance Frauds Bureau of the Insurance Department can
obtain those assets. Funds secured from this source can be used to
finance the operations of the Insurance Fraud Bureau or the Insurance
Fraud Prevention program established by Insurance Law section 40S-a.

Section 19: A new Vehicle & Traffic Law section 201-a is added to give
law enforcement personnel access to any individual's street address
provided to the Department of Motor Vehicles to register a motor
vehicle
in this state or to obtain a driver's license in this State. This
information can be used to ensure that those who submit information
to the Department submit accurate information of their residence and
where they operate and garage their motor vehicle for auto insurance
premium rating purposes.

Section 20: Amends Vehicle & Traffic Law section 401(1) to require
that all those who file an application to register an automobile in
New York must provide their street address where they reside if such
person uses a Post Office box for their location of residence. The
purpose of this provision is to curtail those that submit
fraudulent information on where such applicants truly reside.

Section 21: Amends Vehicle & Traffic Law section 502(1) to require
that all those who file an application for a driver's license must
provide
their street address where they reside if such person uses a Post
Office box for their location of residence.

Section 22: Creates a Temporary Task Force on Motor Vehicle Insurance
Fraud. The Superintendent of Insurance and Commissioner of Motor
Vehicles shall establish a working group to examine the feasibility
and cost effectiveness of developing methodologies to identify owners
and operators of motor vehicles who misrepresent the principle place
of their residence and where they operate and garage their automobiles.

The Task Force shall have 13 members, with the Superintendent of
Insurance and commissioner of Motor Vehicles to act as Co-Chairs. The
remaining members a.re to be appointed as follows: four by the
Governor, 2 by the Temporary President of the Senate, 2 by the
Speaker of the Assembly, one each respectively by each chambers
minority leaders. Task Force members should include representatives
of insurers actively writing motor vehicle insurance, insurance
agents and brokers that actively sell automobile insurance, 2
representatives of companies that collect, disperse and synthesize
data, and 2 representatives of the motor vehicle insurance buying
public. The Task Force should have its recommendations and report
completed within 15 months of the. effective date of this act.

JUSTIFICATION:

The purpose of this bill is to address the ever increasing incidence
of auto insurance fraud in this state. More particularly, this bill
seeks to address insurance fraud that is perpetrated against those
law abiding operators of motor vehicles that accurately and
truthfully disclose where they reside and operate and garage their
vehicles, regardless of where they live. Some who live in high auto
insurance rate areas, such as the New York City metropolitan area,
misrepresent where they live, garage and operate their automobiles
and fraudulently maintain that they live in low insurance premium
rate areas that are either up-state or out of state.

There is a prevalence of in-state residents misrepresenting their true
place of residence so that they can obtain much lower auto insurance
rates. Instead of disclosing their true address in high insurance
premium places such as, for example, Bronx or Kings Counties, they
state that they live in lower insurance premium rated territories
such as North
Carolina, Pennsylvania, or up-state counties that have much lower
incidents of motor vehicle theft, car accidents and judgments
relegated to motor vehicle accidents. This issue was a topic of a
report released in 2006 by the State Commission on Investigations.
since 2006, the commission has sunsetted, however, senator Klein is
revising end updating this report. The new Report "Auto Insurance
Rate Evasion" is scheduled to he released in June 2010. This hill
implements many of the Suggested changes contained in that Report.

This situation or rate evasion, while artificially lowering the
insurance rates of those who fraudulently do not disclose their true
residential address, substantially increases the insurance premiums
paid by those who truthfully disclose their actual place of residence
and where they operated and garaged their cars. This hill should
bring more equity to those who purchase auto insurance coverages in
this state and ensure that everyone pays their fair share for auto
insurance coverages that matches their actuarial risk of potential
physical damage or theft of their automobiles, risk of personal
injury or liability exposure due to judgments obtain in local courts.
The amendments to this bill deleted bill section , because it was
already incorporated in the law and includes a new hill section 14 to
expand the hill's scope related to those who live in New York, but
inappropriately obtain auto insurance coverage in another state
under false pretenses.

LEGISLATIVE HISTORY:
2010 - S.7091 - Referred to Insurance

FISCAL IMPLICATIONS:
To be determined.

EFFECTIVE DATE:
The 60th day after becoming law with provisions.

S988A-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 988--A
 2011-2012 Regular Sessions
 I N  SENATE
 (PREFILED)
 January 5, 2011
 
 Introduced  by  Sens. KLEIN, CARLUCCI, SAVINO, VALESKY -- read twice and
 ordered printed, and when printed to be committed to the Committee  on
 Insurance  --  recommitted to the Committee on Insurance in accordance
 with Senate Rule 6, sec. 8  --  committee  discharged,  bill  amended,
 ordered reprinted as amended and recommitted to said committee
 

AN ACT to amend the insurance law, the financial services law, the exec
 utive  law,  the  state finance law, the penal law, the civil practice
 law and rules and the vehicle and traffic law, in relation  to  insur
 ance  fraud;  to  establish  the temporary task force on motor vehicle
 insurance fraud; and providing for the repeal  of  certain  provisions
 upon the expiration thereof
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1.

Section 401 of the insurance law is amended by adding a new
 subsection (d) to read as follows:

 (D) THE SUPERINTENDENT SHALL HAVE BROAD  AUTHORITY  PURSUANT  TO  THIS
 CHAPTER  TO INVESTIGATE FRAUDULENT ACTIVITIES WITH REGARD TO MOTOR VEHI
 CLE DRIVERS THAT OPERATE AUTOMOBILES WITH  NO  INSURANCE  COVERAGE,  AND
 MOTOR  VEHICLE  INSUREDS  WHO  MISREPRESENT  THE  PRINCIPAL  PLACE WHERE
 INSURED MOTOR VEHICLES ARE GARAGED AND OPERATED. OPERATING  MOTOR  VEHI
 CLES WITHOUT PROPER INSURANCE IN VIOLATION OF ARTICLE SIX OF THE VEHICLE
 AND  TRAFFIC  LAW  IS A SIGNIFICANT DANGER TO THE PUBLIC BECAUSE DRIVERS
 ARE UNABLE TO COMPENSATE INDIVIDUALS FOR PERSONAL  INJURIES,  DEATH  AND
 PROPERTY  DAMAGE  THEY  INFLICT UPON OTHERS.  FURTHERMORE, MOTOR VEHICLE
 INSUREDS WHO MISREPRESENT THE PRINCIPAL PLACE WHERE  SUCH  VEHICLES  ARE
 GARAGED  AND  OPERATED  IMPROPERLY  SHIFT  THEIR HIGH LIABILITY EXPOSURE
 COSTS TO OTHER MOTOR VEHICLE INSUREDS THAT DO NOT FACE SUCH HIGH LIABIL
 ITY RISK AND INSURANCE PREMIUM COSTS.
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD05004-06-2
 
       S. 988--A                           2
 

S 2. Subsection (a) of section 405 of the insurance law, as amended by
 section 7 of part A of chapter 62 of the laws of  2011,  is  amended  to
 read as follows:

 (a)  Any  person  licensed or registered pursuant to the provisions of
 this chapter, and any person engaged in the  business  of  insurance  or
 life  settlement  in this state who is exempted from compliance with the
 licensing requirements of this chapter, including  the  state  insurance
 fund  of  this state, who has reason to believe that an insurance trans
 action or life settlement act may be fraudulent, or has knowledge that a
 fraudulent insurance transaction or fraudulent life  settlement  act  is
 about  to take place, or has taken place shall, within thirty days after
 determination by such person that the transaction appears to be  fraudu
 lent, send to the superintendent on a form prescribed by the superinten
 dent, the information requested by the form and such additional informa
 tion  relative  to  the factual circumstances of the transaction and the
 parties involved as the superintendent may require.  The  superintendent
 shall  accept  reports of suspected fraudulent insurance transactions or
 fraudulent life settlement acts from any self insurer, including but not
 limited to self insurers providing health insurance  coverage  or  those
 defined  in  section  fifty  of the workers' compensation law, and shall
 treat such reports as any other received pursuant to this section.   THE
 SUPERINTENDENT  SHALL  ACCEPT  REPORTS OF SUSPECTED FRAUDULENT INSURANCE
 TRANSACTIONS FROM ANY SELF INSURER INCLUDING, BUT NOT LIMITED  TO,  SELF
 INSURERS  PROVIDING  HEALTH  INSURANCE  COVERAGE,  THOSE PROVIDING MOTOR
 VEHICLE LIABILITY INSURANCE OR THOSE DEFINED IN  SECTION  FIFTY  OF  THE
 WORKERS'  COMPENSATION  LAW,  AND  SHALL TREAT SUCH REPORTS AS ANY OTHER
 RECEIVED PURSUANT TO THIS SECTION.
 

S 3. The insurance law is amended by adding a  new  section  405-a  to
 read as follows:

 

S  405-A.   COMPENSATION FOR REPORT OF INSURANCE FRAUD TO LAW ENFORCE
 MENT AUTHORITIES. (A)  ANY  PERSON,  OTHER  THAN  PERSONS  DESCRIBED  IN
 SUBSECTION  (A)  OF  SECTION FOUR HUNDRED FIVE OF THIS ARTICLE AND OTHER
 THAN A PERSON WHO HAS RECEIVED AN AWARD PURSUANT TO SECTION TWO  HUNDRED
 THIRTY-ONE  OF THE EXECUTIVE LAW, WHO HAS REASON TO BELIEVE THAT A FRAU
 DULENT INSURANCE ACT PROHIBITED PURSUANT TO ARTICLE ONE  HUNDRED  SEVEN
 TY-SIX  OF  THE PENAL LAW HAS BEEN COMMITTED OR THAT AN INSURANCE TRANS
 ACTION MAY BE FRAUDULENT, OR HAS KNOWLEDGE THAT A  FRAUDULENT  INSURANCE
 TRANSACTION  IS  ABOUT TO TAKE PLACE, OR HAS TAKEN PLACE MAY REPORT SUCH
 ACT OR TRANSACTION AND ANY ADDITIONAL INFORMATION RELATIVE TO THE FACTU
 AL CIRCUMSTANCES OF THE TRANSACTION AND  THE  PARTIES  INVOLVED  TO  THE
 ATTORNEY GENERAL, DISTRICT ATTORNEY OR SUPERINTENDENT.
 (B)  IF  THE  SUPERINTENDENT  RECOMMENDS  TO  THE  ATTORNEY GENERAL OR
 DISTRICT ATTORNEY TO COMMENCE AN ACTION, OR IF THE ATTORNEY  GENERAL  OR
 DISTRICT ATTORNEY COMMENCES AN ACTION BASED ON INFORMATION PROVIDED BY A
 PERSON  PURSUANT  TO  SUBSECTION  (A)  OF THIS SECTION, THEN SUCH PERSON
 SHALL BE ENTITLED TO RECEIVE AN AWARD OF NOT MORE THAN  FIFTEEN  PERCENT
 OF  THE PROCEEDS OF THE ACTION OR A SETTLEMENT OF THE CLAIM IN AN AMOUNT
 NOT TO EXCEED TWENTY-FIVE THOUSAND DOLLARS.   THE  ATTORNEY  GENERAL  OR
 DISTRICT  ATTORNEY  SHALL  RECOMMEND  TO  THE COURT WHEN A SETTLEMENT IS
 ENTERED THE AMOUNT OF SUCH AWARD. THE COURT SHALL BASE SUCH AWARD  DECI
 SION  ON THE EXTENT TO WHICH THE PERSON SUBSTANTIALLY CONTRIBUTED TO THE
 PROSECUTION OF THE ACTION.
 

S 4.

Section 2133 of the insurance law, as amended by  chapter  77  of
 the laws of 1994, is amended to read as follows:

 

S  2133. [Forged] FALSE INSURANCE DOCUMENTS AND FORGED insurance iden
 tification cards. Any  insurance  company,  insurance  agent,  insurance
 
       S. 988--A                           3
 broker  or  other person who or which, personally or by the action of an
 employee or agent, KNOWINGLY possesses, transfers or uses: (A) ANY DOCU
 MENT WHICH PURPORTS TO EVINCE INSURANCE COVERAGE WHEN SUCH  COVERAGE  IS
 NOT  IN  EFFECT  OR IS IN EFFECT AT LIMITS LESS THAN THOSE STATED IN THE
 DOCUMENT; OR (B) a forged insurance  identification  card  for  a  motor
 vehicle, having knowledge, personally or through such employee or agent,
 of  the  fact  that such insurance identification card, when issued, did
 not actually represent an owner's policy of  liability  insurance  or  a
 financial  security  bond  issued by an insurance company licensed to do
 business in this state covering the motor  vehicle  identified  on  such
 card, shall be liable for payment to the people of this state of a civil
 penalty  in  a sum not exceeding one thousand dollars for the first such
 violation and a sum not exceeding five thousand dollars for each  subse
 quent  violation.  For  the  purposes  of  this section the term "forged
 insurance identification card" means a written insurance  identification
 card  which  has  been  falsely made, completed or altered, and the term
 "falsely made, completed or altered" shall have the same meaning as  set
 forth in section 170.00 of the penal law.
 

S 5. 

Section 405 of the financial services law, as added by section 1
 of  part  A  of  chapter  62  of the laws of 2011, is amended to read as
 follows:

 

S 405. Immunity. In the absence of  fraud  or  bad  faith,  no  person
 subject to the provisions of this chapter, the banking law or the insur
 ance  law  shall  be  subject  to civil liability, and no civil cause of
 action of any nature shall arise against such person for any: (a) infor
 mation relating to suspected violations of the banking law or the insur
 ance law furnished  to  law  enforcement  officials,  their  agents  and
 employees; (b) information relating to suspected violations of the bank
 ing  law or the insurance law furnished to other persons [subject to the
 provisions of this chapter]; and (c) information furnished in reports to
 THE ATTORNEY GENERAL, A DISTRICT  ATTORNEY,  the  financial  frauds  and
 consumer  protection  unit,  its agents or employees or any state agency
 investigating fraud or  misconduct  relating  to  financial  fraud,  its
 agents or employees. The superintendent or any employee of the financial
 frauds  and  consumer  protection  unit,  in the absence of fraud or bad
 faith, shall not be subject to civil liability and  no  civil  cause  of
 action  of any nature shall arise against the superintendent or any such
 employee by virtue of the publication of any report or bulletin  related
 to  the  official  activities  of  the  financial  frauds  and  consumer
 protection unit. Nothing [herein] IN THIS SECTION is intended  to  abro
 gate  or  modify in any way any common law privilege or immunity hereto
 fore enjoyed by any person.
 

S 6. The executive law is amended by adding a new section 231 to  read
 as follows:

 

S  231.  INSURANCE  FRAUD REWARD PROGRAM; ESTABLISHMENT. 1. THE SUPER
 INTENDENT SHALL ESTABLISH A STATEWIDE INSURANCE FRAUD REWARD PROGRAM  TO
 PAY  REWARDS  FOR  INFORMATION  LEADING  TO THE ARREST AND CONVICTION OF
 PERSONS GUILTY OF A FRAUDULENT INSURANCE ACT AS DEFINED IN  ARTICLE  ONE
 HUNDRED SEVENTY-SIX OF THE PENAL LAW.
 2. THE SUPERINTENDENT SHALL CAUSE TO BE ESTABLISHED A TOLL-FREE STATE
 WIDE  TELEPHONE NUMBER AND INTERNET WEBSITE FOR USE IN COLLECTING INFOR
 MATION TO ASSIST IN THE INVESTIGATION AND PROSECUTION OF INSURANCE FRAUD
 CRIMES.
 3. THE SUPERINTENDENT IS AUTHORIZED TO PROVIDE REWARDS OF  UP  TO  ONE
 THOUSAND DOLLARS FOR INFORMATION LEADING TO THE ARREST AND CONVICTION OF
 
       S. 988--A                           4
 INDIVIDUALS  GUILTY  OF A FRAUDULENT INSURANCE ACT AS DEFINED IN ARTICLE
 ONE HUNDRED SEVENTY-SIX OF THE PENAL LAW.
 4.  THE  SUPERINTENDENT IS AUTHORIZED TO PROVIDE REWARDS OF UP TO FIVE
 THOUSAND DOLLARS FOR INFORMATION LEADING TO THE ARREST AND CONVICTION OF
 INDIVIDUALS GUILTY OF A SPECIFIED OFFENSE IN ARTICLE ONE HUNDRED  SEVEN
 TY-SIX OF THE PENAL LAW.
 5.  NO  PERSON  WHO  RECEIVES  COMPENSATION  PURSUANT  TO SECTION FOUR
 HUNDRED FIVE-A OF THE INSURANCE LAW  SHALL  BE  ELIGIBLE  FOR  A  REWARD
 PURSUANT TO THIS SECTION.
 6.  THE SUPERINTENDENT SHALL DISBURSE THE REWARDS PROVIDED FOR IN THIS
 SECTION FROM THE MONEYS APPROPRIATED TO THE  DIVISION  OF  STATE  POLICE
 FROM  THE STATE POLICE MOTOR VEHICLE LAW ENFORCEMENT ACCOUNT ESTABLISHED
 BY SECTION NINETY-SEVEN-MM OF THE STATE FINANCE LAW, AS ADDED BY SECTION
 THREE HUNDRED EIGHTY-SEVEN OF CHAPTER FIFTY-FIVE OF THE LAWS OF NINETEEN
 HUNDRED NINETY-TWO.
 

S 7. Paragraph (a) of subdivision 2 of section 846-m of the  executive
 law,  as  amended  by  section  6 of part T of chapter 57 of the laws of
 2000, is amended to read as follows:

 (a) The moneys received by the fund shall be expended in a manner that
 is consistent with the plan of  operation,  pursuant  to  appropriation,
 only  to reimburse costs incurred by provider agencies for pilot program
 activities relating to the detection, prevention or reduction  of  motor
 vehicle theft and motor vehicle insurance fraud; PROVIDED, HOWEVER, THAT
 ON AND AFTER JANUARY FIRST, TWO THOUSAND TWELVE, AT LEAST ONE-QUARTER OF
 THE  MONEYS  RECEIVED  BY  THE  FUND  SHALL  BE DISBURSED EXCLUSIVELY TO
 SUPPORT EFFORTS UNDERTAKEN BY DISTRICT ATTORNEYS TO DETECT, IDENTIFY AND
 PROSECUTE FRAUD PERTAINING TO ARTICLE FIFTY-ONE OF THE INSURANCE LAW.
 

S 8. Subdivision 3 of section 97-mm  of  the  state  finance  law,  as
 amended  by  section  5  of part T of chapter 56 of the laws of 2009, is
 amended to read as follows:

 3. Nine million one hundred thousand dollars  annually  of  the  state
 police motor vehicle law enforcement account, following appropriation by
 the  legislature  and allocation by the director of the budget, shall be
 made available for the state operation expenses of the division of state
 police including but not limited to the costs of activities relating  to
 the  detection, prosecution or reduction of automobile theft and related
 purposes, AND THE COSTS OF THE INSURANCE  FRAUD  REWARD  PROGRAM  ESTAB
 LISHED  PURSUANT TO SECTION TWO HUNDRED THIRTY-ONE OF THE EXECUTIVE LAW.
 All other funds of  the  state  police  motor  vehicle  law  enforcement
 account,  following  appropriation  by the legislature and allocation by
 the director of the budget, shall be made available for the state opera
 tion expenses of the division of state police including but not  limited
 to the costs of activities relating to highway safety and public securi
 ty.
 

S 9. Subdivision 4 of section 97-mm of the state finance law, as added
 by  section 8 of part T of chapter 57 of the laws of 2000, is amended to
 read as follows:

 4. The superintendent of state police, no later than  March  fifteenth
 of each year, shall furnish to the governor, the speaker of the assembly
 and  the  temporary  president  of  the  senate, a report detailing each
 programmatic component associated with the automobile theft AND  AUTOMO
 BILE  INSURANCE  FRAUD prevention activities of the state police for the
 previous year. The report shall include, but not be limited to, a break
 down of the funds allocated to each programmatic component, including  a
 breakdown  by personal and nonpersonal services and number of employees,
 and the number of arrests,  convictions,  and  vehicle  recoveries.  The
 
       S. 988--A                           5
 report  shall  also  contain  an analysis of the incidence of automobile
 theft AND AUTOMOBILE INSURANCE FRAUD for each of the state police  troop
 jurisdictions.
 

S 10.  Subdivision 5 of section 170.10 of the penal law is amended and
 a new subdivision 6 is added to read as follows:

 5. A prescription of a duly licensed physician or other person author
 ized  to issue the same for any drug or any instrument or device used in
 the taking or  administering  of  drugs  for  which  a  prescription  is
 required by law[.]; OR
 6.  A CERTIFICATE OF INSURANCE OR AN INSURANCE IDENTIFICATION CARD, AS
 DEFINED IN SECTION THREE HUNDRED ELEVEN OF THE VEHICLE AND TRAFFIC LAW.
 

S 11.

Section 170.15 of the penal law is amended to read as follows:

 

S 170.15 Forgery in the first degree.
 A person is guilty of forgery in the first degree when, with intent to
 defraud, deceive or injure another, he OR SHE falsely  makes,  completes
 or alters [a]:

 1. TEN OR MORE WRITTEN INSTRUMENTS; OR
 2. A written instrument which is or purports to be, or which is calcu
 lated to become or to represent if completed:

 [1.]  (A) Part of an issue of money, stamps, securities or other valu
 able instruments issued by a government or governmental instrumentality;
 or
 [2.] (B) Part of an issue of stock, bonds or other instruments repres
 enting interests in or claims against a corporate or other  organization
 or its property.
 Forgery in the first degree is a class C felony.
 

S  12. The penal law is amended by adding a new section 175.50 to read
 as follows:

 

S 175.50 OFFERING A FALSE APPLICATION FOR  MOTOR  VEHICLE  INSURANCE  OR
 REGISTRATION.
 A  PERSON  IS GUILTY OF OFFERING A FALSE APPLICATION FOR MOTOR VEHICLE
 INSURANCE OR REGISTRATION WHEN KNOWING THAT ANY DOCUMENT HE OR SHE FILES
 WITH THE DEPARTMENT OF MOTOR VEHICLES OR AN INSURER PROVIDING  LIABILITY
 INSURANCE FOR A MOTOR VEHICLE CONTAINS A FALSE STATEMENT OR FALSE INFOR
 MATION  WITH REGARD TO WHERE HE OR SHE RESIDES OR WHERE HIS OR HER MOTOR
 VEHICLE IS GARAGED AND OPERATED.
 OFFERING A FALSE APPLICATION FOR MOTOR VEHICLE INSURANCE OR  REGISTRA
 TION IS A CLASS E FELONY.
 

S  13. The opening paragraph of subdivision 1 of section 176.05 of the
 penal law, as amended by chapter 211 of the laws of 2011, is amended  to
 read as follows:

 any written statement as part of, or in support of, an application for
 the  issuance  of,  or  the rating of a commercial OR PERSONAL insurance
 policy, or certificate or evidence  of  self  insurance  for  commercial
 insurance  or  commercial  OR  PERSONAL  self  insurance, or a claim for
 payment or other benefit pursuant to an insurance policy or self  insur
 ance  program  for commercial or personal insurance that he or she knows
 to:

 

S 14.

Section 176.15 of the penal law, as amended by  chapter  515  of
 the laws of 1986, is amended to read as follows:

 

S 176.15 Insurance fraud in the fourth degree.
 A  person  is  guilty  of insurance fraud in the fourth degree when he
 [commits] OR SHE:

 1. COMMITS a fraudulent insurance act and  thereby  wrongfully  takes,
 obtains or withholds, or attempts to wrongfully take, obtain or withhold
 property with a value in excess of one thousand dollars; OR
 
       S. 988--A                           6
 2. OPERATES A MOTOR VEHICLE ON A PUBLIC HIGHWAY, WHEN SUCH MOTOR VEHI
 CLE  IS INSURED BY A POLICY ISSUED UNDER THE LAWS OF ANOTHER STATE, WHEN
 SUCH PERSON MAINTAINS HIS OR HER PRINCIPAL RESIDENCE IN  THIS  STATE  OR
 SUCH MOTOR VEHICLE IS PRINCIPALLY GARAGED IN THIS STATE, AND SUCH INSUR
 ANCE POLICY WAS ISSUED UPON ANY WRITTEN OR ORAL STATEMENT BY SUCH PERSON
 THAT  HE  OR  SHE  PRINCIPALLY  RESIDES IN SUCH OTHER STATE OR THAT SUCH
 MOTOR VEHICLE IS PRINCIPALLY GARAGED IN SUCH OTHER STATE.
 Insurance fraud in the fourth degree is a class E felony.
 

S 15. Paragraph (c) of subdivision 4-b of section 1310  of  the  civil
 practice  law and rules, as added by chapter 655 of the laws of 1990, is
 amended and a new paragraph (d) is added to read as follows:

 (c) a conviction of a  person  for  a  violation  of  section  220.09,
 220.16, 220.34 or 220.39 of the penal law, or a conviction of a criminal
 defendant  for  a violation of section 221.30 of the penal law, or where
 the accusatory instrument charges any such  felony,  conviction  upon  a
 plea of guilty to a felony for which the plea is otherwise authorized by
 law, together with evidence which: (i) provides substantial indicia that
 the  defendant  used the real property to engage in a continual, ongoing
 course of conduct involving the unlawful mixing,  compounding,  manufac
 turing,  warehousing, or packaging of controlled substances or where the
 conviction is for a violation of section 221.30 of the penal law,  mari
 juana, as part of an illegal trade or business for gain; and (ii) estab
 lishes, where the conviction is for possession of a controlled substance
 or  where  the  conviction  is  for a violation of section 221.30 of the
 penal law, marijuana, that such possession was with the intent  to  sell
 it[.]; OR
 (D)  A  CONVICTION  OF  A  PERSON OF ANY FELONY DEFINED IN ARTICLE ONE
 HUNDRED SEVENTY-SIX OF THE PENAL LAW, OR OF AN ATTEMPT OR CONSPIRACY  TO
 COMMIT ANY SUCH FELONY, PROVIDED THAT SUCH ATTEMPT OR CONSPIRACY CONSTI
 TUTES A FELONY.
 

S  16.  Subdivision  3-a of section 1311 of the civil practice law and
 rules, as added by chapter 655 of the laws of 1990, is amended  to  read
 as follows:

 3-a.  Conviction  of  a person in a criminal action upon an accusatory
 instrument which includes one or  more  of  the  felonies  specified  in
 subdivision  four-b  of section thirteen hundred ten of this article, of
 any felony other than such felonies, shall not preclude a defendant,  in
 any subsequent proceeding under this article where that conviction is at
 issue, from adducing evidence that the conduct underlying the conviction
 would  not  establish  the  elements of any of the felonies specified in
 such subdivision other than the one to which the criminal defendant pled
 guilty. If the defendant does adduce such evidence, the burden shall  be
 upon  the claiming authority to prove, by clear and convincing evidence,
 that the conduct underlying the criminal conviction would establish  the
 elements  of the felony specified in such subdivision. Nothing contained
 in this subdivision shall affect the validity of  a  settlement  of  any
 forfeiture action negotiated between the claiming authority and a crimi
 nal defendant contemporaneously with the taking of a plea of guilty in a
 criminal action to any felony defined in article ONE HUNDRED SEVENTY-SIX
 OR  two hundred twenty, or section 221.30 or 221.55 of the penal law, or
 to a felony conspiracy to commit the same.
 

S 17. Paragraphs (a) and (b) of subdivision 11 of section 1311 of  the
 civil  practice  law  and rules, as amended by section 47 of part A-1 of
 chapter 56 of the laws of 2010, are amended to read as follows:

 (a) Any stipulation or settlement agreement between the parties  to  a
 forfeiture  action  shall  be filed with the clerk of the court in which
 
       S. 988--A                           7
 the forfeiture action is pending. No stipulation or settlement agreement
 shall be accepted for filing unless it is accompanied  by  an  affidavit
 from  the  claiming  authority that written notice of the stipulation or
 settlement agreement, including the terms of such, has been given to the
 office  of  victim  services,  the  [state] division of criminal justice
 services, and in the case of a forfeiture based on a felony  defined  in
 article two hundred twenty or section 221.30 or 221.55 of the penal law,
 to  the  [state  division]  OFFICE  of  ALCOHOLISM  AND  substance abuse
 services. IN THE THE CASE OF A FORFEITURE BASED ON A FELONY  DEFINED  IN
 ARTICLE ONE HUNDRED SEVENTY-SIX OF THE PENAL LAW, SUCH NOTICE SHALL ALSO
 BE GIVEN TO THE INSURANCE FRAUDS BUREAU OF THE INSURANCE DEPARTMENT.
 (b)  No  judgment  or order of forfeiture shall be accepted for filing
 unless it is accompanied by an affidavit  from  the  claiming  authority
 that  written  notice of judgment or order, including the terms of such,
 has been given to the office of victim services, the [state] division of
 criminal justice services, and in the case of a forfeiture  based  on  a
 felony defined in article two hundred twenty or section 221.30 or 221.55
 of  the  penal  law,  to  the  [state division] OFFICE of ALCOHOLISM AND
 substance abuse services. IN THE CASE OF A FORFEITURE BASED ON A  FELONY
 DEFINED IN ARTICLE ONE HUNDRED SEVENTY-SIX OF THE PENAL LAW, SUCH NOTICE
 SHALL  ALSO  BE  GIVEN  TO  THE INSURANCE FRAUDS BUREAU OF THE INSURANCE
 DEPARTMENT.
 

S 18. Subdivision 4 of section 1349 of  the  civil  practice  law  and
 rules, as amended by section 48 of part A-1 of chapter 56 of the laws of
 2010, is amended to read as follows:

 4.  The  claiming  authority shall report the disposal of property and
 collection of assets pursuant to this section to the  office  of  victim
 services,  the  [state] division of criminal justice services [and], the
 [state division] OFFICE of ALCOHOLISM AND substance abuse  services  AND
 THE SUPERINTENDENT OF FINANCIAL SERVICES.
 

S  19.  The vehicle and traffic law is amended by adding a new section
 201-a to read as follows:

 

S 201-A.  ACCESS  TO  INFORMATION.  THE  DEPARTMENT  SHALL  ALLOW  LAW
 ENFORCEMENT PERSONNEL ACCESS TO ANY INDIVIDUAL'S STREET ADDRESS PROVIDED
 PURSUANT  TO  PARAGRAPH B OF SUBDIVISION ONE OF SECTION FOUR HUNDRED ONE
 AND SUBDIVISION ONE OF SECTION FIVE HUNDRED TWO OF THIS CHAPTER.
 

S 20. Paragraph b of subdivision 1 of section 401 of the  vehicle  and
 traffic  law,  as amended by chapter 222 of the laws of 1996, is amended
 to read as follows:

 b. Every owner of a motor vehicle which shall be  operated  or  driven
 upon  the  public  highways  of  this  state  shall, except as otherwise
 expressly provided, cause to be presented, by mail or otherwise, to  the
 office  or  a  branch office of the commissioner, or to any agent of the
 commissioner, constituted as provided in this  chapter,  an  application
 for  registration  addressed  to  the commissioner, and on a blank to be
 prepared under the direction of and furnished by  the  commissioner  for
 that  purpose,  containing: (a) a brief description of the motor vehicle
 to be registered, including the name and factory number of such vehicle,
 and such other facts as the commissioner shall require; (b)  the  weight
 of  the  vehicle  upon which the registration fee is based if the fee is
 based on weight; (c) the name and residence,  including  county  of  the
 owner  of such motor vehicle, PROVIDED THAT IF THE APPLICANT USES A POST
 OFFICE BOX WHEN PROVIDING A RESIDENCE ADDRESS, SUCH APPLICANT SHALL ALSO
 PROVIDE THE STREET ADDRESS AT WHICH HE  OR  SHE  RESIDES;  (d)  provided
 that,  if  such  motor  vehicle is used or to be used as an omnibus, the
 applicant also shall so certify, and in the  case  of  an  omnibus  also
 
       S. 988--A                           8
 certify as to the seating capacity, and if the omnibus is to be operated
 wholly  within a municipality pursuant to a franchise other than a fran
 chise express or implied  in  articles  of  incorporation  upon  certain
 streets  designated  in such franchise, those facts shall also be certi
 fied, and a certified copy of such franchise furnished  to  the  commis
 sioner;  (e) provided, that, if such motor vehicle is an altered livery,
 the applicant shall so furnish a certified copy of  the  length  of  the
 center  panel  of such vehicle, provided, however, that the commissioner
 shall require such proof, as he OR SHE may determine  is  necessary,  in
 the  application  for  registration  and provided further, if the center
 panel of such vehicle exceeds one hundred inches, the commissioner shall
 require proof that such vehicle is in  compliance  with  all  applicable
 federal  and  state  motor  vehicle safety standards; and (f) such addi
 tional facts or evidence as the commissioner may require  in  connection
 with  the  application  for registration. Every owner of a trailer shall
 also make application for the registration thereof in the manner  herein
 provided  for  an  application  to  register  a motor vehicle, but shall
 contain a statement showing the manufacturer's number or other identifi
 cation satisfactory to the commissioner and no number plate for a trail
 er issued under the provisions of  subdivision  three  of  section  four
 hundred  two  of  this [chapter] ARTICLE shall be transferred to or used
 upon any other trailer than the one for which number  plate  is  issued.
 The  commissioner  shall require proof, in the application for registra
 tion, or otherwise, as such commissioner may determine, that  the  motor
 vehicle  for  which  registration is applied for is equipped with lights
 conforming in all respects to the requirements of this chapter,  and  no
 motor  vehicle shall be registered unless it shall appear by such proofs
 that such motor vehicle is equipped with proper lights as aforesaid. The
 said application shall contain or be accompanied by such evidence of the
 ownership of the motor vehicle described in the application  as  may  be
 required by the commissioner or his OR HER agent and which, with respect
 to  new  vehicles, shall include, unless otherwise specifically provided
 by the commissioner, the manufacturer's statement  of  origin.  Applica
 tions received by an agent of the commissioner shall be forwarded to the
 commissioner  as  he  OR SHE shall direct for filing. No application for
 registration shall be accepted unless the applicant is at least  sixteen
 years  of age AND HAS SIGNED SUCH APPLICATION ATTESTING TO THE TRUTH AND
 VERACITY OF THE FACTS STATED THEREIN.
 

S 21. Subdivision 1 of section 502 of the vehicle and traffic law,  as
 amended  by  section  2 of part CC of chapter 58 of the laws of 2011, is
 amended to read as follows:

 1. Application for license. Application for a driver's  license  shall
 be  made to the commissioner. The fee prescribed by law may be submitted
 with such application. The applicant shall furnish such proof of identi
 ty, age, ADDRESS OF HIS OR HER RESIDENCE and fitness as may be  required
 by  the  commissioner.   WHEN PROVIDING HIS OR HER ADDRESS OF RESIDENCE,
 THE APPLICANT SHALL PROVIDE THE  STREET  ADDRESS  AT  WHICH  HE  OR  SHE
 RESIDES.  EACH  APPLICANT SHALL SIGN HIS OR HER APPLICATION ATTESTING TO
 THE TRUTH AND VERACITY OF THE FACTS STATED THEREIN. The commissioner may
 also provide that the application procedure shall include the taking  of
 a  photo  image  or images of the applicant in accordance with rules and
 regulations prescribed by the commissioner. In addition, the commission
 er also shall require that the applicant provide his or her social secu
 rity number and provide space on the application so that  the  applicant
 may register in the New York state organ and tissue donor registry under
 section  forty-three  hundred ten of the public health law. In addition,
 
       S. 988--A                           9
 an applicant for a  commercial  driver's  license  who  will  operate  a
 commercial  motor vehicle in interstate commerce shall certify that such
 applicant meets the requirements to operate a commercial motor  vehicle,
 as  set  forth in public law 99-570, title XII, and title 49 of the code
 of federal regulations, and all regulations promulgated  by  the  United
 States  secretary of transportation under the hazardous materials trans
 portation act. In addition,  an  applicant  for  a  commercial  driver's
 license shall submit a medical certificate at such intervals as required
 by  the  federal  motor  carrier safety improvement act of 1999 and Part
 383.71(h) of title 49 of the code of  federal  regulations  relating  to
 medical  certification  and  in a manner prescribed by the commissioner.
 For purposes of this section and sections five hundred  three  and  five
 hundred ten-a of this title, the term "medical certificate" shall mean a
 form  substantially  in  compliance  with  the  form  set  forth in Part
 391.43(h) of title 49 of the code of federal regulations. Upon a  deter
 mination  that  the holder of a commercial driver's license has made any
 false statement, with respect to the application for such  license,  the
 commissioner shall revoke such license.
 

S  22.  Temporary task force on motor vehicle insurance fraud. (a) The
 superintendent of financial services and the commissioner of motor vehi
 cles shall convene a temporary task force  on  motor  vehicle  insurance
 fraud  to  examine  the feasibility and cost-effectiveness of developing
 methodologies to identify owners and operators  of  motor  vehicles  who
 misrepresent the principal place of their residence or where their motor
 vehicles  are garaged and operated. Such task force shall develop a plan
 on the feasibility of implementing a statewide registry  of  the  street
 addresses  of  the owners and operators of motor vehicles in this state.
 The report issued by this task force shall:

 (1) investigate the  feasibility  of  developing  and  implementing  a
 statewide  registry  of the addresses of motor vehicle owners and opera
 tors;
 (2) detail the costs of establishing such a registry;
 (3) identify the parameters for entering and retrieving data from such
 registry; and
 (4) evaluate the value of establishing such  registry  in  identifying
 motor vehicle owners and operators who misrepresent their place of resi
 dence or where their vehicle is garaged and operated.
 (b)  The task force shall consist of 13 members. The superintendent of
 financial services and the commissioner  of  motor  vehicles,  or  their
 designees, shall be members of the task force and shall be the co-chairs
 of the task force. A representative of the New York Automobile Insurance
 Plan  shall  be a member of the task force. The remaining ten members of
 the task force shall be appointed as follows: four shall be appointed by
 the governor, two shall be appointed by the temporary president  of  the
 senate, two shall be appointed by the speaker of the assembly, one shall
 be  appointed  by  the  minority  leader of the senate, and one shall be
 appointed by the minority leader of the assembly. Of such  ten  members:

 three  shall be representatives of insurers actively writing motor vehi
 cle insurance in this state,  three  shall  be  representatives  of  the
 insurance  agent  and  broker  community  actively selling motor vehicle
 insurance in this state, two shall be representatives of  companies  the
 business of which involves collecting, dispersing and synthesizing data,
 and  two  shall be representatives of the motor vehicle insurance buying
 public.
 
       S. 988--A                          10
 (c) The task force shall submit a  report  to  the  governor  and  the
 legislature  of  its  findings,  conclusions  and recommendations within
 fifteen months of the effective date of this section.
 

S  23.  This  act shall take effect on the sixtieth day after it shall
 have become a law, provided that section twenty-two of  this  act  shall
 expire  and  be deemed repealed eighteen months after the effective date
 of this act.

*By contributing or voting you agree to the Terms of Participation and Privacy Policy and verify you are over 13.

Discuss!