It's the Law

The Insurance Fraud Investigation Division was created by 1997 Arkansas legislation designed to investigate and prosecute all types of insurance related criminal activity [A.C.A. § 23-66-501,et seq.]. The Division includes the Workers' Compensation Fraud Investigation Unit (WCFIU), which began operations in 1993 [A.C.A. §11-9-106]. The Division’s name was changed to the Criminal Investigation Division by a legislative act in 2005.

Legislation introduced in 2001 designated the Division a law enforcement agency [A.C.A. § 23-66-508 (a)(3)(A)].  The Division carries out its statutory mandate by receiving referrals from various sources, including insurance companies, interested citizens, and other state and federal law enforcement and regulatory agencies.

In addition to its law enforcement powers, the Division has the authority to issue subpoenas to obtain testimony under oath and to compel the production of documents [A.C.A. § 23-66-508(c)].  Additionally, the Division’s attorneys are authorized to be appointed special deputy prosecuting attorneys [A.C.A. § 23-66-508 (c)(4)(B)].

FRAUD REFERRALS –        

The Division carries out its statutory mandate by receiving referrals from various sources, including insurance companies, employers, employees, agents, and interested citizens. It then conducts investigations to determine whether there have been criminal violations of the law. Investigations that result in a finding of criminal violation are referred to the appropriate prosecuting attorney.  [Uniform Suspected Insurance Fraud Reporting Form]

ANTI-FRAUD PLAN –

Insurance companies licensed in the State of Arkansas must submit an antifraud plan pursuant to the antifraud initiative requirements of [A.C.A. §23-66-510 (a)].  Questions concerning the requirements should be directed to Raymond Boyles, Esq. at 501-371-2790 or raymond.boyles@arkansas.gov.  [Also reference:  Mandatory Reporting of suspected insurance fraud, fraud warnings, antifraud initiatives and disqualifications required by Act 217 of 1997 Bulletin No. 7-97 and Antifraud Initiative Requirements Rule and Regulation 66.]

ASSESSMENT –

An assessment to support the Criminal Investigation Division is collected annually.  The Insurance Commissioner has established an antifraud assessment schedule pursuant to [A.C.A. §23-100-104]. [See also, Rule and Regulation No. 5]  All licensed insurers, including but not limited to Reinsurers, Health Maintenance Organizations, Farmers Mutual Aid Associations, Fraternal Benefit Societies, Hospital and Medical Service Corporations, Stipulated Premium Plan Insurers, Reciprocal Insurers, Title Insurers and Prepaid Legal Insurance Companies (note:  Surplus Lines, TPA and Risk Management Companies are exempt) are responsible for payment of an annual assessment.  The assessment is based upon the direct premium and/or annuity consideration written or renewed from or in the State of Arkansas during the previous calendar year.  The antifraud assessment form and instructions are available online.  [A.C.A. 23-100-101 through 107].

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