Remarks by District Attorney Tony Rackauckas

Remarks by District Attorney Tony Rackauckas

K-Fraud press conference

February 4, 2009


Thank you for coming.  The media is an integral part of promoting public safety in these types of cases.


I would like to thank the California Department of Insurance, National Insurance Crime Bureau, California State Bar, Cypress Police Department, Garden Grove Police Department, Laguna Beach Police Department, Tustin Police Department, Automobile Club of Southern California, Infinity Insurance, Mercury Insurance, and Sentry Insurance Companies for their assistance in these cases. 


I especially appreciate the leadership and commitment of Insurance Commissioner Steve Poizner in helping our office to continue our battle against fraud.  You will be hearing from Mr. Poizner later.


From the State Bar, we have attorney Brooke Schafer and investigator Craig Matheny.


In my hands, I am holding copies of checks amounting to thousands of dollars. 


These are the checks we had to pay out during our undercover operations.  This may not seem like a lot of money in the scope of all of the fraud that is going on out there, but if you extrapolate that this investigation represents just one so-called patient of many that a chiropractor or attorney may see, you can see the fraudulent dollar signs multiply. 


During these tough economic times, we have people who are trying to avoid foreclosures on their homes and struggling to feed their families.  All of us are feeling the pinch, including my Office, which will have to prosecute more cases with less and less resources.  Insurance costs exceed many families’ budgets.  When every dollar counts, it matters that your auto insurance and health insurance keeps skyrocketing because of fraud.  It matters that goods and services costs more because businesses are forced to pass on the costs of their inflated insurance payments due to fraud.


I don’t know about you, but I frankly am sick of these types of fraud, which affect every citizen in Orange County and California. 


Investigating and prosecuting fraud takes a lot of resources — time, investigators and money.  We had to develop an operation where we were able to catch these chiropractors, attorneys, and their staff in the act.  We had to have the cooperation of insurance companies and police agencies.  We had to literally put District Attorney Investigators at risk of harm by having them receive these so-called chiropractic treatments.  Not only are consumers and insurance companies hurt by these types of fraud, but it hurts the ethical, skilled chiropractors and attorneys, who would not resort to such dishonesty.  We had to fund these fake claims and be patient in processing the payments.