Allstate Sues Philadelphia-area Business for Auto Insurance Fraud

Allstate Insurance Company yesterday filed a lawsuit in Philadelphia against Leonardo Karpin and Helen Giordano and L.K. Diagnostics Inc. seeking over $250,000 in costs and treble damages stemming from an alleged scheme to defraud the company's policyholders.

Karpin and Giordano have already pleaded guilty to charges of mail fraud in federal court resulting from bills submitted to insurers for physical therapy administered by unlicensed personnel without a doctor's supervision which involved L.K. Diagnostics Inc. (also referred to as Center for Physio Therapy). The case was investigated by the Allstate Valley Forge Special Investigation Unit. Countrywide, the 600 members of the Allstate Special Investigation Unit gather evidence and prepare similar cases for prosecution.

"Auto insurance fraud affects all of us," says Ed Moran, assistant vice president for the Allstate Special Investigation Unit. "We are serving notice that we will use every means at our disposal against individuals and businesses who hamper our ability to deliver competitive rates to our policyholders."

In 1997, Allstate sued more than 1,000 people involved in an alleged auto insurance fraud ring in New Jersey. More recently, Allstate was awarded $10 million in California after it successfully used the RICO act to sue several lawyers and chiropractors for filing false auto insurance claims.