TRENTON – Acting Attorney General John J. Hoffman announced today that six Passaic County residents have been charged for their alleged roles in a staged-automobile accident scheme that defrauded two insurance companies of a total of more than $78,000.
Ariel Ballista, 27, of Passaic; Jonathan Damian, 26, of Passaic, Husayn Encarnacion, 35, of Paterson; his wife, Jenny Encarnacion, 33, of Paterson; and Harold Gross, 29, of Passaic, were all arrested on Wednesday, April 16. Olivares R. Liberato-Cohen, 45, of Passaic, was separately issued a summons. The defendants were charged in an April 10 state grand jury indictment with conspiracy, insurance fraud and theft by deception, all in the second-degree. Additionally, Jenny Encarnacion was charged with third-degree hindering apprehension or prosecution, while Husayn Encarnacion was indicted on one count each of third-degree and fourth-degree hindering apprehension or prosecution. Gross was charged with two counts of fourth-degree false swearing, while Ballista, Damian and Jenny Encarnacion were each charged with one count of fourth-degree false swearing.
“Staged automobile accidents have a domino effect on the insurance industry,” Acting Attorney General Hoffman said. “By staging these types of accidents and engaging in fraudulent conduct, the participants in these schemes drive up the cost of automobile insurance in this state.”
“This investigation was the result of information that our team developed from an earlier investigation,” Acting Insurance Fraud Prosecutor Ronald Chillemi said. “The Office of the Insurance Fraud Prosecutor will follow a case wherever it may lead.”
The investigation into this case was the result of a prior investigation into staged automobile accidents that occurred in Passaic County. That investigation led to an indictment against Liberato-Cohen and others. The charges against Liberato-Cohen in that separate indictment remain pending.
The April 10 indictment alleges that between March 1, 2009 and on or about Aug. 1, 2013, the defendants conspired to participate in a staged automobile accident in order to fraudulently collect more than $78,000 in insurance benefits. According to the indictment, Liberato-Cohen allegedly recruited Gross, Damian, Husayn and Jenny Encarnacion and an unindicted co-conspirator to participate in the staged automobile accident. Husayn Encarnacion is alleged to have assisted Liberato-Cohen in the recruitment of his wife, Jenny.
An investigation determined that on April 25, 2009, Liberato-Cohen allegedly purposely drove his Dodge Caravan, containing Damian, Gross and Jenny Encarnacion, into a Dodge Avenger, driven by an unindicted co-conspirator. It is alleged that Ballista was the sole passenger in the Avenger, and that he agreed to participate in the conspiracy following the collision.
Following the staged accident, Liberato-Cohen, Ballista, Gross, Damian, and Jenny Encarnacion each allegedly visited certain designated medical providers and submitted, or caused to be submitted, claims to Mercury Insurance Group and Plymouth Rock Assurance (formerly Twin Lights Insurance Company), which insured the automobiles and/or individuals involved in the staged accident. It is alleged that, as a result of the illegal scheme, the defendants and their medical providers received a total of $78,829 in medical reimbursement payments and bodily injury settlements.
Deputy Attorneys General Bradford Muller and Michael Locke, Lt. Frederic Moore, Sgt. Weldon Powell, Det. Janessa Jones, and Det. Cortney Lawrence coordinated the investigation. Analyst Bethany Schussler assisted in the investigation. Additional investigative assistance was provided by Det. Grace Rocca and Det. Trainee Suzanna Lopez. Acting Insurance Fraud Prosecutor Chillemi also thanked the Special Investigation Units from Mercury Insurance Group and Plymouth Rock Assurance, in particular Michelle Miller of Plymouth Rock Assurance, as well Michael Mullane from the Division of Taxation for their assistance in the investigation.
The indictment is merely an accusation and the defendants are presumed innocent until proven guilty. Second-degree crimes carry a maximum sentence of 10 years in state prison and a criminal fine of up to $150,000 while third-degree crimes carry a maximum sentence of five years in state prison and a criminal fine of $15,000. Fourth-degree crimes carry a maximum sentence of 18 months in state prison and a criminal fine of up to $10,000.