In May 2014, brothers Anhuar and Karim Bandy, and 10 co-conspirators were arrested and charged with racketeering, conspiracy, criminal use of runners and other related charges. According to the New Jersey Office of the Attorney General, the brothers were the ringleaders of “a scheme in which illegal ‘runners’ were used to recruit motor vehicle accident victims as patients for chiropractic facilities, controlled by unlicensed individuals [Karim and Anhuar Bandy], and as clients for other medical and legal service providers… in order to generate revenue for the chiropractic facilities, Anhuar and Karim Bandy used runners to bring motor vehicle accident patients to the facilities so they could bill insurance carriers for services rendered at the facilities. An investigation determined that, through the scheme, the chiropractic facilities allegedly billed insurance companies for millions of dollars for services they purported to perform.” The prosecutors alleged that this scheme lasted from 2009 through 2013.
As well as getting millions of dollars in fraudulent insurance claims, personal injury lawyer David Walker allegedly paid thousands of dollars in kickbacks to the brothers for referring patients to him for legal representation. Walker, and a paralegal working at his firm, Alexandra Gallegos met with patients at the chiropractic facilities in order to convince the patients to let them represent them in suing for settlements from insurance carriers.
In July 2014, Anhuar and Karim Bandy both pleaded guilty to insurance fraud in the second degree.
Fast forward to 2017 – one of those insurance companies, Allstate, through their N.J. subsidiary Encompass Insurance, as well as the New Jersey Department of Banking and Insurance Commissioner, Richard J. Badolato, are filing a joint lawsuit against Anhuar Bandy, David Walker, and Alexandra Gallegos. The lawsuit alleges that Anhuar was the mastermind of the scheme, and that Walker and Gallegos paid kickbacks to Bandy for referrals.
According to the State of New Jersey Department of Banking and Insurance, the lawsuit “follows an investigation by the Department’s Bureau of Fraud Deterrence, Allstate and OIFP [Office of the Insurance Fraud Prosecutor]. On behalf of New Jersey consumers, the Department is seeking a substantial, yet undetermined IFPA-mandated fine amount and Allstate is seeking reimbursement for personal injury protection benefits that Allstate paid on behalf of its customers.”