Bill > S09135

This bill, known as the "fraudulent claims reduction and unlawful deception act" or "FRAUD Act," aims to combat insurance fraud by establishing new crimes and enhancing penalties for staging construction site accidents and auto insurance fraud involving fabricated collisions and claims. It defines "fraudulent insurance claim" as any intentionally false or misleading claim submitted to an insurer, and clarifies that "construction site" refers to locations where building, repair, or demolition work is occurring. The act creates a new felony offense for intentionally staging or fabricating a construction site accident to file an insurance claim, and another felony for staging auto collisions or submitting false claims under an automobile insurance policy, with increased penalties if the attempted loss exceeds $1,500. Furthermore, individuals convicted of these new offenses will be required to provide restitution to the insurer, face civil penalties of up to $5,000 plus the fraudulent claim amount, and could be excluded from state-regulated insurance benefits for up to two years. The bill also mandates insurers to report suspected fraud to law enforcement and cooperate with investigations, and requires the Superintendent of Financial Services to implement regulations and allocate resources to fraud investigation units.

Housing and Urban Affairs

https://www.nysenate.gov/legislation/bills/2025/S9135