New York Appellate Lawyer

48 Wall Street, 5th Floor, New York, NY 10005

Federal Criminal Appeals Throughout The United States and
New York State Criminal Appeals.

Located at 48 Wall Street, 5th Floor, New York, NY! 1-800-APPEALS (277-3257)

Business Records: What Constitutes A Business Record For Purposes Of Insurance Fraud


Defendant falsified buisness records to seek recompense appeals

People v. Kisina

14 NY3d 153

New York Court of Appeals

Decided on: February 18, 2010

 Defendant Filed False Business Records To Seek Recompense For Procedures Purportedly Performed

Summary: Defendant was a part time physician at IK Medical P.C clinic. The facility provided medical care to motor vehicle accident victims eligible for no-fault insurance coverage. The Attorney General investigated the clinic for insurance fraud, and Defendant was subsequently indicted.

At trial, the People introduced evidence of two insurance claims that were performed on two accident victims. The two accident victims testified at trial that they had never received any of the tests reportedly performed by Defendant and only received two tests that Defendant billed State Farm for. A stipulation agreement was signed by both parties and explained that the Verification of treatment forms and accompanying medical reports Defendant submitted to State Farm are intended as evidence of its obligation to pay the attending physician or other provider of health service. Defendant claims that the statute was not violated because she was a third party working part time and should be immune from prosecution.

The jury found Defendant guilty of insurance fraud in the third degree and falsifying business records in the first degree. The Appellate Division affirmed and a Judge of the Court of Appeals granted leave to appeal. The Court of Appeals held that Penal Law § 175.00 prescribes no limitation or preconditions on the types of persons who may fall within the ambit of this crime. Nowhere does the Penal Law state that outsiders or third parties not employed by or agents of the recipient enterprise are immune from prosecution under this statue. The Court of Appeals affirmed the Appellate Division’s order.

See Also: Defendant Can Not Revisit Past Violent Felony For The Possibility Of Youthful Offender Status

Issue: Whether Penal law § 175.10 is violated when an outsider or third party submits false information to a company to induce it to take action to reliance upon that information, and whether medical reports submitted by a part time physician that document false evidence of her activities and false evidence on the condition of her patients constitute business records.

Holding: Yes, an outsider or third party can be found guilty of falsifying business records. The Court of Appeals held that there is no limitation or precondition on the types of persons who may fall within the ambit of this crime. Nowhere does the Penal Law 175.00 (2) state that “outsiders” or “third parties” not employed by or agents of the recipient enterprise are immune from prosecution under this statute.

The Court of Appeals held that the documents Defendant submitted related to the rights and obligation of State Farm to reimburse medical providers for services. Penal law § 175.10 prescribes a business record as any writing or article kept or maintained by an enterprise for the purpose of evidencing or reflecting its condition or activity.

Facts: Defendant was a part time physician who specialized in physical medicine and rehabilitation treatment for accident victims at IK Medical P.C clinic. The facility reportedly provided comprehensive medical care to motor vehicle accident victims eligible for no-fault insurance coverage. The Attorney General investigated the clinic for insurance fraud and other related crimes, and subsequently indicted Defendant. The falsifying business records charges were based upon false consultation reports that Defendant submitted to State Farm Mutual Automobile Insurance Company, along with verification of treatment forms seeking recompense for procedures she purportedly performed on two motor vehicle accident victims.

At trial, the People introduced evidence of two insurance claims that were performed on two accident victims. Defendant signed the claim forms entitled, New York Motor Vehicle No-Fault Insurance Law Verification Of Treatment by Attending Physician and submitted them to State Farm. The stipulation agreement explained that the Verification of Treatment Forms and accompanying medical reports Defendant submitted to State Farm are intended to evidence its obligation to pay the attending physician or other provider of health service for treatment or healthcare services rendered. The two witnesses testified at trial that they had never received any of the tests reportedly performed by Defendant and only received two tests that Defendant billed State Farm for.

Defendant argues that she worked part time at the clinic and was immune to prosecution under the statue as a third party. The jury found Defendant guilty of insurance fraud and falsifying business records. The Appellate Division affirmed and a Judge from the Court of Appeals granted leave to appeal.

Legal Analysis: The Court of Appeals held that there was sufficient evidence that Defendant falsified business records seeking recompense for procedures she purportedly performed. The Court held that Defendant administered unnecessary procedures and submitted false claims. Where the language of a statute is clear and unambiguous, courts must give effect to its plain meaning, Matter of Tall Trees Constr. Corp. v Zoning Bd. of Appeals of Town of Huntington, 97 NY2d 86, 91 2001.

Defendant claimed that she was a third party who worked part time and was immune from prosecution under the statue. Nowhere does Penal Law 175.00 (2) state that “outsiders” or “third parties” not employed by or agents of the recipient enterprise are immune from prosecution under this statute. The Court of Appeals held that there is no limitation or precondition on the types of persons who may fall within the ambit of this crime.

     Defendant next argues that the medical reports that she submitted to State Farm are not business records because they do not reflect the condition or activity of the recipient enterprise, but rather falsely indicate her activities and the condition of her patients. The Court held that a business record is any writing or article kept or maintained by an enterprise for the purpose of evidencing or reflecting its condition or activity, Penal Law § 175.00 (2).

Under Penal Law § 175.05 (1) Falsifying business records in the first degree is committed when a person, with the requisite intent, makes or causes a false entry in the business records of an enterprise. Under Penal Law §175.10, the person must act with an intent to defraud, which includes and intent to commit another crime or to aid or conceal the commission thereof. The stipulated testimony from the company representatives supports the necessary elements of a business record and State Farm’s financial condition is affected by these false submissions, as they give rise to liabilities under its policies. State Farm was obligated to keep and maintain records submitted by Physicians seeking payments for medical services rendered and they relied heavily on the accuracy of such statements. The Court of Appeals affirmed the Appellate Division’s order.


Related Articles