Richmond Costco and Kaiser employees center of large-scale insurance fraud ring, prosecutors say [Contra Costa Times, Walnut Creek, Calif.]

<p><chron>Oct. 07</chron>--<location value="LU/us.ca.marnez" idsrc="xmltag.org">MARTINEZ</location> -- Sixteen of 22 defendants were arraigned Thursday as part of a suspected <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa County</location> insurance fraud ring case resulting in a 289-count felony indictment, thought to be the largest in county history.</p> <p>The indictment charges defendants who defrauded 11 insurance companies of at least <money>$345,000</money> -- and attempted to defraud more than <money>$1 million</money> more -- through staged residential and auto burglaries, motor vehicle accidents, and personal injury and wage-loss claims, <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa County</location> deputy district attorney <person>Alison Chandler</person> said.</p> <p>Most of the defendants are <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa County</location> residents, some are from <location value="LU/us.ca.solano" idsrc="xmltag.org">Solano County</location> and two currently live in <location value="LU/us.ny.nyc" idsrc="xmltag.org">New York</location> and <location value="LS/us.ne" idsrc="xmltag.org">Nebraska</location>, respectively.</p> <p>The defendants are employees of the Richmond Costco and <person>Richmond Kaiser Permanente</person> hospital, their friends, family members and associates, said Chandler, who presented three weeks of evidence to a <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa</location> grand jury to wrap up a two-year investigation lead by the <org>California Department of Insurance Fraud Division</org>. The indictments were handed down <chron>Sept. 22</chron>; arrest and search warrants were executed Wednesday.</p> <p>"There was dozens of insurance claims that include tens of thousands of pages of documents and span over 10 years," Chandler said.</p> <p>No one arraigned Thursday in <location value="LU/us.ca.marnez" idsrc="xmltag.org">Martinez</location> entered a plea to the charges; they return to court to do so Thursday. The group's collective bail is set at more than <money>$18 million</money>. Each of them is charged with conspiracy</p> <p>to commit insurance fraud, while additional charges include insurance fraud, attempted and actual grand theft, and commercial burglary, plus charge enhancements.</p> <p>The three most "heavily involved" parties who recruited others into the ring are <location value="LU/us.ca.herles" idsrc="xmltag.org">Hercules</location> resident and former Kaiser employee <person>Kelechi Charles Chukwueke</person> , and former Costco employees Paul Onwuvuariri, formerly of <location value="LU/us.ca.antoch" idsrc="xmltag.org">Antioch</location>, and his brother Bede Onwuvuariri, of <location value="LU/us.ca.herles" idsrc="xmltag.org">Hercules</location>, Chandler said.</p> <p>According to the prosecutor, some of the Costco employees would buy high-priced items at their employer's store, such as a <money>$10,000</money> diamond ring, then alter and photocopy the receipt and return the item. The fraudulent receipt would then be used for multiple bogus residential burglary loss claims in <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa County</location>, Chandler said. She added that employees at Kaiser and Costco would pretend to be injured in a traffic accident and then make wage-loss claims, but continue to work.</p> <p>Authorities launched an investigation into the ring in <chron>July 2009</chron> after companies noticed "red flags" such as large claims by recent policy holders and numerous suspect claims within the same time period.</p> <p>"In these tough economic times legitimate law-abiding businesses and consumers need real protection from those seeking to scam the system, which can lead to higher insurance rates and premiums that many can't afford," <location value="LU/us.ca.consta" idsrc="xmltag.org">Contra Costa</location> District Attorney <person>Mark Peterson</person> said in a news release Wednesday. "We hope that interagency cooperation between law enforcement teams like the <org>Office of the District Attorney</org> and the <org>Department of Insurance</org> will lead to even more successful operations like the one we're announcing today."</p> <p>Contact <person>Malaika Fraley</person> at 925-234-1684. Follow her at <a href="http://Twitter.com/malaikafraley">Twitter.com/malaikafraley</a>.</p> <p class="shirttail">___</p> <p class="shirttail">(c)2011 the Contra Costa Times (Walnut Creek, Calif.)</p> <p class="shirttail">Visit the Contra Costa Times (Walnut Creek, Calif.) at www.contracostatimes.com</p> <p class="shirttail">Distributed by MCT Information Services</p>