Advising an Insurer of a Claim When Insurance Obtained by Fraud is a Crime

Conviction Affirmed Against the best Wishes of the Appellate Court

In Commonwealth of Pennsylvania v. Renee M. Bruder, J-S40005-19, No. 1282 WDA 2018, Superior Court of Pennsylvania (September 30, 2019) Renee M. Bruder, appealed from a sentence of 3 years’ probation, imposed after a jury convicted her of insurance fraud.

Bruder was charged with insurance fraud, 18 Pa.C.S. § 4117(a)(2); criminal attempt-insurance fraud, 18 Pa.C.S. § 901(a); false reports to law enforcement, 18 Pa.C.S. § 4906(b)(1); and operating a vehicle without required financial responsibility, 75 Pa.C.S. § 1786(f). Bruder’s case proceeded to a two-day trial in August of 2018. Immediately before the beginning of trial, the Commonwealth withdrew the charge of criminal attempt-insurance fraud.

FACTS

At trial, Officer Eric Porter of the Ingram Borough Police Department testified that, on December 17, 2016, at approximately 2:02 p.m., he came upon a motor vehicle accident involving two motor vehicles on Steuben Street. He described that Bruder’s Honda Pilot had struck a vehicle that had been traveling in the opposite direction on Steuben Street. Officer Porter said that he subsequently learned that the vehicle that Bruder had struck was deemed totaled. After ensuring that there were no injuries, Officer Porter said he collected pertinent information from the parties involved, but then had to leave the scene due to an emergency call. Officer Porter recalled that Appellant had provided him with a policy number from Nationwide Insurance (“Nationwide”).

The following day — December 18, 2016 — Officer Porter explained that he called Appellant to follow-up on the accident and gather more information about her insurance since he had to leave the scene to respond to another call. He testified that Appellant told him that she had “provided [him] with the wrong insurance information and that she didn’t realize she had an old insurance card that she [had] handed” him. Officer Porter stated that Appellant then gave him a new insurance policy number, and made no mention that the insurance card she had handed him the day before had been canceled. Officer Porter explained that Appellant’s new insurance policy was with Titan Insurance, a branch of Nationwide.

After talking with Bruder Ms. La Rue (the agent) described that she then started processing the new policy and, at around 5:31 p.m. that day and Bruder did not mention anything to her about having been involved in an accident a couple hours prior to calling her. Ms. La Rue said that Bruder did not try to make a claim for the accident with her and stated that she does not handle claims. testified. Bruder testified and stated that she is fifty-three years old and has an eighth grade education. She explained that, at the time of the accident, she thought she had insurance, and did not find out that her insurance had been canceled until she called her insurance company to report the accident when she got home.

Bruder also testified that she made a call to the insurance company on December 19, 2016 which resulted in a claims investigation.

TRIAL VERDICT

At the conclusion of trial, the jury found Appellant guilty of insurance fraud, and not guilty of false reports to law enforcement. The trial court found Appellant guilty of the summary offense of operating a vehicle without required financial responsibility. That same day, the trial court sentenced Appellant to 3 years’ probation and 200 hours of community service for her insurance fraud conviction, and imposed a $300 fine on Appellant for operating a vehicle without required financial responsibility. Bruder argued that her “conviction for [i]nsurance [f]raud must be vacated because the Commonwealth failed to prove beyond a reasonable doubt that [she] intended to file an insurance claim or specifically intended to defraud her insurance company when she reported her accident.” She insists that “[n]o evidence was presented that [she] filed any paperwork related to a claim, followed up with the insurance company regarding a claim, obtained any quotes for repairing the damage to her vehicle, or otherwise took any action related to the purported claim after reporting the accident.”

The trial court rationalized: “The jury reasonably determined from the evidence admitted at trial that Appellant had been involved in an automobile accident, provided an expired insurance card to the police officer, then obtained new insurance without mentioning the earlier accident, gave the police officer information from her new insurance policy, called her new insurance company and initiated a claim under the new policy. From these facts, the jury could reasonably conclude that Appellant had the intent to defraud the insurer to cover an accident which occurred prior to the obtained coverage.”

The appellate court felt constrained to conclude that the evidence was sufficient to support the conviction. To reiterate, the statute provides that a person commits an offense if he or she “[k]nowingly and with the intent to defraud any insurer…, presents or causes to be presented to any insurer … any statement forming a part of, or in support of, a claim that contains any false, incomplete or misleading information concerning any fact or thing material to the claim.” 18 Pa.C.S. § 4117(a)(2).

Bruder made no indication to Officer Porter or Ms. La Rue that the accident occurred while she had no insurance. She subsequently contacted the insurance company, supplied her new policy number, failed to mention that the accident occurred prior to that policy taking effect, allowed a claim to be initiated on her behalf, and provided false, incomplete and/or misleading information regarding the time of the accident. This circumstantial evidence supports an intent to defraud. Moreover, as the Commonwealth points out, the jury rejected Appellant’s alternative explanation for why she called the insurance company and accepted a claim number.

Applying the statute the court felt compelled to express concern over the breadth and application of the statute because the evidence did not demonstrate that Bruder affirmatively stated at any point that she wanted to make a claim, nor does it show that she continued to pursue the claim after reporting the accident. However, the statute criminalizes her conduct. There is no evidence that Bruder explicitly asked to make a claim, submitted any billing statements to the insurance company, obtained an estimate on the cost of repairs, completed paperwork relating to the claim, or otherwise followed up on the status of it.

The Commonwealth emphasizes — and the jury apparently credited— that Appellant accepted a claim number. The appellate court felt that broad reach of this statute may stifle insureds from reporting accidents and inquiring about coverage, particularly in scenarios where the facts of an incident are not clear-cut. The court suggested that the Commonwealth temper the reach of this sweeping statute by exercising prosecutorial discretion.

ZALMA OPINION

There is no question that Bruder, who applied for and received insurance after an accident that because it started at 12:01 a.m. on the date it was bound, that gave her coverage for the accident and was obtained by fraud. She was convicted of making a fraudulent claim and since she reported it to the insurer the crime was committed. She also committed the crime of obtaining an insurance policy by fraud so the sentence, regardless of the concerns of the appellate court, was fair.