Bill > A10224

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 staged construction site accidents and auto insurance fraud involving fabricated collisions. It defines a "fraudulent insurance claim" as intentionally false or misleading claims made to obtain benefits not legally due, and clarifies that a "construction site" includes any location where building, repair, or demolition work is occurring. The act creates the crime of staging a construction site accident for insurance fraud, which is a Class E felony, and also defines auto insurance fraud involving staged collisions and fabricated claims as a Class E felony, with increased penalties if the value of losses exceeds $1,500. Furthermore, individuals convicted of these crimes will be required to provide restitution to insurers, face civil penalties, and could be excluded from state-regulated insurance policies for up to two years. The bill also mandates that insurers report suspected fraudulent claims to law enforcement, cooperate with investigations, and submit annual fraud data to the legislature, with the Superintendent of Financial Services responsible for implementing these regulations and ensuring increased resources for insurance fraud units.

Housing and Urban Affairs

https://www.nysenate.gov/legislation/bills/2025/A10224