N.Y. Comp. Codes R. & Regs. Tit. 9 § 5.109 - Executive order no. 109: establishing a special prosecutor to investigate and prosecute criminal acts relating to fraudulent motor vehicle insurance claims

WHEREAS, the Comprehensive Motor Vehicle Insurance Reparations Act (commonly known as the "No-Fault law") was enacted by the New York State Legislature over twenty-five years ago to ensure that every accident victim will be compensated for economic loss, promptly and without regard to fault;

WHEREAS, this No-Fault system has succeeded in stabilizing the costs of automobile insurance in this State while benefitting consumers by combining a package of first-party benefits for economic losses resulting from injury and prompt payment of such benefits, in return for allowing suits for non-economic damages only for specified serious injuries;

WHEREAS, recently there has been a dramatic increase in the cost of some motor vehicle insurance coverages, and much of this increase is attributable to fraudulent and abusive motor vehicle insurance claims practices. In fact, it has been alleged that motor vehicle insurance fraud may cost the average New York consumer hundreds of dollars per year in higher insurance premiums;

WHEREAS, fraudulent and abusive claims activity harms consumers, health care providers and insurers by increasing insurance costs, slowing claims processing and payment, and creating an increasingly adversarial relationship among affected parties;

WHEREAS, law enforcement agencies and District Attorneys have made significant efforts to combat this growing motor vehicle insurance fraud problem and have acted with diligence to prosecute insurance cases in their jurisdictions. The investigation, development and prosecution of such cases require significant resources, however, and existing resources are being stretched in these efforts to respond to this fast-growing problem;

WHEREAS, it is necessary to bolster and augment the important work being done by our State's law enforcement and prosecutorial communities by directing additional prosecutorial and investigative resources in areas where fraudulent motor vehicle insurance activity is prevalent;

WHEREAS, the benefit to be derived from such efforts can be increased further by fostering greater coordination among prosecutors and law enforcement officials in their battle against motor vehicle insurance fraud.

NOW, THEREFORE, I, GEORGE E. PATAKI, Governor of the State of New York, by virtue of the authority vested in me by the Constitution and Laws of the State of New York, and particularly by subdivision eight of section 63 of the Executive Law, and in accordance with the statute and law in such cases made and provided, find it to be in the public interest to require that the Attorney General inquire, in the circumstances and the manner hereafter provided, into matters concerning public peace, public safety and public justice with respect to criminal acts relating to fraudulent motor vehicle insurance claims.

I. Special Prosecutor

1. I hereby appoint the Attorney General as Special Prosecutor to coordinate the investigatory and prosecutorial efforts pursuant to this Executive Order. The Attorney General and such deputies and assistants as he deems necessary shall have the powers and duties specified in subdivision eight of section 63 of the Executive Law for the purposes of this Executive Order.

2. The Superintendent of the Division of State Police and the Superintendent of the Department of Insurance are directed to authorize the Attorney General, pursuant to the provisions of subdivision three of section 63 of the Executive Law and the statutes and law in such cases made and provided, to conduct an investigation of the alleged commission of any indictable offense or offenses as provided by the Penal, Insurance or Vehicle and Traffic Laws arising out of motor vehicle insurance claims, or to other crimes related to this activity or uncovered by the Attorney General in connection with his activities pursuant to this Executive Order, and to prosecute the person or persons believed to have committed the same and any crime or offense arising out of such investigation or prosecution or both, including, but not limited to, appearing before and presenting all such matters to a grand jury.

3. The Special Prosecutor is requested and authorized to cooperate with and assist District Attorneys, the Division of State Police, the Insurance Department, the Division of Criminal Justice Services and other law enforcement officials in their efforts against fraudulent or otherwise criminal acts committed in violation of any laws of this State in connection with motor vehicle insurance claims.

II. Report

The Division of Criminal Justice Services, in consultation with the Special Prosecutor, the Insurance Department and the Division of State Police, shall prepare an annual report to the Governor regarding the efficacy of efforts to investigate and prosecute motor vehicle insurance fraud cases undertaken pursuant to this order on or before the first day of March of each year.

III. Assistance of State Agencies

The Division of State Police, the Division of Criminal Justice Services, the Insurance Department and every other State department, agency, division, board, bureau, commission and any other entity over which I have executive power shall provide appropriate assistance and cooperate as necessary with the Special Prosecutor, the State's District Attorneys and other law enforcement officials to fulfill the purposes of this Executive Order.

Signed: George E. PatakiDated: May 9, 2001

Notes

N.Y. Comp. Codes R. & Regs. Tit. 9 § 5.109