S.C. lawmakers focus on insurance fraud

Legislators and insurance company officials are hashing out ways to improve existing laws against insurance fraud and fund more law enforcement positions to fight the crime.

Insurance fraud in South Carolina has risen sharply in the past five years as the state office that prosecutes the crime has had its budget cut.

A meeting this week was organized by state Rep. Daniel Tripp, R-Mauldin, who last year helped put together a bill to strengthen fraud laws. The bill failed, but Tripp said he hopes to reintroduce legislation in January.

“If we can fight fraud, it’s good for the carriers, it’s good for the consumers, it’s good for everyone except those who commit fraud,” he said. “At the end of the day, we want to figure out how best to fight fraud.”

Insurance fraud can range from a person underreporting the number of miles he drives his car to save a few bucks to more complex schemes such as businesses misclassifying workers to avoid paying high premiums required for more dangerous jobs.

A key component to fight fraud, many said, is increasing the number of investigators and prosecutors assigned to the state’s insurance fraud division at the attorney general’s office.

That office, which has one prosecutor and two State Law Enforcement Division agents, has about $300,000 to investigate and prosecute as many as 600 criminal cases a year.

“We have two people in South Carolina doing what other states have 30 people doing,” said Lynn Szymoniak, a lawyer whose firms specialize in fighting fraud for the insurance industry in Florida and South Carolina.

Last year’s bill would have assessed carriers about $2.5 million to help fund more investigators and prosecutors and create a civil enforcement unit under the state Insurance Department.

Trey Walker, spokesman for the attorney general’s office, said the $750,000 that would have gone to his department could have funded about a half-dozen additional prosecutors in an office in which the budget has been slashed by 35 percent in recent years.