Crime & Safety

Colts Neck Brothers Plead Guilty To Insurance Fraud

The men paid runners to recruit crash victims as patients for chiropractic facilities they controlled, authorities said.

Two Colts Neck brothers pleaded guilty Tuesday to organizing an insurance fraud scheme, in which they paid runners to recruit crash victims as patients for chiropractic facilities they controlled, authorities said.

The two men also received kickbacks from some medical providers and personal injury attorneys in exchange for referring patients to those businesses, authorities said.

Anhuar Bandy, 52, and Karim Bandy, 53, both entered guilty pleas to second-degree insurance fraud before state Superior Court Judge Pedro Jimenez, sitting in Mercer County.

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Under the terms of the plea agreement, the state will recommend each man receive a six-and-a-half-year prison term and a $100,000 fine at sentencing, scheduled for Sept. 11, according to a news release from Acting Attorney General John J. Hoffman and the Office of the Insurance Fraud Prosecutor (OIFP.)

According to the news release:

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In April 2014, the brothers and ten other people were indicted by a state grand jury for their involvement in the scheme.

The indictment charged that between June 1, 2009 and Jan. 1, 2014, the brothers illegally controlled several chiropractic facilities through purported “management companies” and “marketing companies” because they wanted to hide their ownership.

Under New Jersey law, chiropractic facilities must be owned by licensed chiropractors or medical doctors, but the brothers are neither.

The Bandy brothers used runners to “bring motor vehicle accident patients to the facilities, so the straw owners could bill insurance carriers for services.”

Investigators determined the chiropractic facilities billed insurance companies for millions of dollars.

A large portion of the money was then “paid to the Bandy management companies.”

The runners used the Open Public Records Act to obtain accident reports at police stations. Then they went to the homes of the crash victims to try to convince them to use the chiropractic facilities.

The runners were paid up to $1,000 for each patient that they recruited.

They picked up the patients at their homes and drove them to the chiropractic facilities.

“An investigation determined that payments allegedly were made to companies incorporated by Karim Bandy for over a thousand referrals of patients for medical treatment and/or clients for legal representation.”

In 2004, Anhuar Bandy was convicted of criminal racketeering, conspiracy, health care claims fraud, and theft. He served about four years in state prison.

Charges against the co-defendants are pending.

Deputy Attorney General Reid Caster, Deputy Insurance Fraud Prosecutor Mark Ondris, Lt. Joseph Waters, Detective Michael Behar and Investigator/Analyst Marwa Kashef coordinated the investigation.

Sgt. Jon Powers and Detectives Janet Amberg, Amy Carson, Heather Pittman, Richard Lane and Analyst Bethany Schussler assisted in the investigation.

Acting Insurance Fraud Prosecutor Ronald Chillemi thanked the Special Investigations Units and counsel for the following insurance Companies: Allstate, Plymouth Rock, Liberty Mutual, Geico and Travelers; as well as the New Jersey Department of Banking and Insurance, the New Jersey Division of Taxation, and the National Insurance Crime Bureau for their assistance in the investigation.

Photos courtesy state Attorney General’s Office; Karim Bandy; Anhuar Bandy


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