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August 14, 2025 • 24 mins
Frank Sztuk CEO of New York Alliance Against Insurance Fraud | CEO's You Should Know
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Episode Transcript

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Speaker 1 (00:00):
Hey, it's Ken Dash out for CEOs. You should know.

Speaker 2 (00:03):
Now you probably know me from Q one to four
point three New York's classic rock. But I love meeting people.
And we always talk about on the air, talk about
insurance fraud, and it's real. Absolutely, and I happened to
have with me. Frank Stook the chair of the public
Outreach Committee for the New York Alliance Against Insurance Fraud.
He's also the senior vice president of Investigative Services at

(00:25):
Telta Group.

Speaker 1 (00:26):
Welcome to iHeart, Frank.

Speaker 3 (00:27):
Thank you very much. Thank you for having me.

Speaker 1 (00:29):
What an incredible journey. Where did it start? Did you
start in law enforcement? I did.

Speaker 3 (00:33):
I started. I became a police officer in nineteen seventy
two at the ripe old age of eighteen and was
there until nineteen eighty one. In nineteen eighty I broke
my trigger finger playing baseball.

Speaker 1 (00:47):
Nice what position?

Speaker 3 (00:48):
I was a catcher? The tools of ignorance, tools of ignorance.
You got to be the smartest person on the field.

Speaker 1 (00:54):
Yeah, you should have seen Yogi's hands. He was a friend.

Speaker 2 (00:56):
Yeah, there was not one straight finger on those hands.

Speaker 3 (01:00):
And I didn't want to stay inside because I couldn't
shoot anymore. So. My brother worked at the Handover Insurance
Company and told me about an opportunity that the industry
was starting to build what's called special investigation units. He said,
why don't you come in and talk to our senior VP,
and you know, maybe something can come out of it.
Met him for lunch, brought me back to the office

(01:24):
and offered me the job that afternoon and the rest
is history. And it was there until twenty seventeen. From
nineteen eighty one.

Speaker 1 (01:33):
It's basically detective work, isn't it.

Speaker 3 (01:35):
In essence it is. The difference is that you don't
arrest people. At the end of the investigation. You either
pay their claim or write their policy, or mitigate or
deny their claim based on fraud.

Speaker 2 (01:50):
So, you know, Double and Demni. One of my favorite
movies of all time Edward g. Robinson is kind of
what you were doing right.

Speaker 3 (01:58):
That is absolutely right. The other movie you should know
ken is The Fortune Cookie. Yes, was from nineteen sixty six,
which is all about insurance fraud.

Speaker 2 (02:09):
I you know, I've it outrages me when there's something
about scams that I hate.

Speaker 1 (02:14):
I hate I hate it on a corporate level.

Speaker 2 (02:17):
But what hurts worse is when you see people doing
it to just the average person, the fake auto accidents,
you know, getting innocent people involved, or you know, torching
your business or your car like you do. You're just
so selfish to do that and hurting so many people
around you.

Speaker 3 (02:35):
The interesting thing about about insurance fraud ken and it's
it's something that I've studied, i speak on, is there's
a lot of honest people committing fraud. What and there's
a lot of honest people can't explain that because they
don't realize committing insurance fraud is a criminal act, you know.
And they these are people who wouldn't think would never

(02:58):
steal from a bi business or anything. But they don't.
They don't correlate insurance fraud to u to theft, you know.
They there's a there's a concept. And one of the
things that that we see in our industry is one
of the drivers of fraud is people's ability to get
back at the insurance industry because why, I mean, let's

(03:19):
face it, the insurance industry is probably not the most
popular industry in the country, maybe second only to the
I R S. So people have this attitude that while
I've been paying my insurance rate for years. What's a
little bit of insurance fraud and the reality of it
is And if you look at the tagline for the

(03:42):
New York Alliance Against Insurance Fraud, it's the crime you
pay for. And people have to understand that every every
time somebody commits fraud, it hurts everybody, and not just
the people who are paying for insurance. It hurts everybody.
And it you know, there's there's a you know, we've
attributed a specific dollar amount to those things in the

(04:04):
state of New York. So so yeah, the whole concept
is people don't they rationalize that it's an okay thing
to do.

Speaker 1 (04:14):
It makes sense the way you explain it.

Speaker 2 (04:16):
I mean, part of me is so many legitimate medical
claims and testing things get rejected by insurance companies.

Speaker 1 (04:23):
And I'm sure.

Speaker 2 (04:24):
I shouldn't say I'm sure because I believe I don't
have the knowledge, but I would bet so many people
sending fraudulent claims.

Speaker 1 (04:32):
That that's what tips the scales.

Speaker 2 (04:33):
The other way of forcing you to jump through hoop
after hoop to prove the viability of an operation or
procedure or something you need.

Speaker 3 (04:41):
That's certainly part of it. And I think that in
my career. I've been doing this for close to forty
five years, fighting insurance for it. And you would think
that I would be a total cynic, but I'm not.
I'm really not. You know, there's I understand why people
commit fraud. I don't obviously don't condone it, right, but
you know, when you look at you know, when you
look at the definition of insurance fraud, it's the abuse

(05:05):
of the insurance system for financial gain. Who commits insurance
fraud individuals, corporations, insurance companies in some cases, agents in
some cases. So it really is a large sphere of
people who can commit fraud.

Speaker 2 (05:23):
Is here a percentage where it's mostly individuals or mostly
corporate or mostly.

Speaker 3 (05:28):
This depends on the type of insurance. Okay, if you
look at automobile insurance, for instance, most of the fraud
that we see on the automobile side is committed by
individuals or and if you look at it from a
commercial perspective, workers comfraud for instance, the biggest part of

(05:50):
where comfraud is on the part of the unscrupulous employer
who who's gaming the system. So it depends on the
type of the type of insurance that we're talking about to.

Speaker 1 (06:00):
Ask you what are the most common types of fraud
that you.

Speaker 3 (06:02):
See automobile, for instance, the most common type of automobile
insurance fraud is what we call rate avision.

Speaker 1 (06:10):
Rate evasions.

Speaker 3 (06:12):
Okay, that's the situation where somebody who lives in Brooklyn,
for instance, will use their cousin's address in New Jersey
to get their automobile insurance, right, because we all know
that the automobile insurance in New York is very expensive
and New Jersey is expensive too, but it's not as

(06:34):
much as say the five Burroughs. So that's a simple
form of fraud, but it's probably one of the most
common types of fraud we see. And then another form
of rate evasion is you know people who who they
misrepresent the amount of miles they drive every year for instance.
Very simple thing, but it's costing the industry money because

(06:55):
your most policies are based on how much you use
your car, which makes sense, which makes sense. So if
somebody's lying on their application about where they live about
you you know how much they drive or prior accidents
for instance, that's a form of fraud. And that's in automobile.
Now we also see what we call staged accidents, which

(07:17):
are intended accidents. A great example of that we all
saw it about four or five months ago on the
Belt Parkway where a woman was driving in the in
the left lane. She had a dash camera yep, you
know the one I'm talking about, and the car pulls
in front of her, slams on their brakes, but she stopped,

(07:41):
didn't hit the car because I mean, the real thumb
is if you hit somebody from the rear, you're you're
at full. Then you see the car in front, we're
you know, the reverse lights go on and he smashes
into this woman's cart at a pretty good clip and
causes an accident. Well, thank god this person had their

(08:05):
their dash cam with that. People jump out of the car,
You see people moving positions in the car, The driver
switches to the passenger side, the people walking around are
walking around holding their neck, and the driver, the guy
who was the driver, jumps out, jumps in another car
and takes off. Ah, that was a staged accident. Fortunately

(08:28):
they've all been arrested.

Speaker 2 (08:30):
Reminds all of us, especially me, I'm ordering a dash
cam immediately.

Speaker 1 (08:34):
When we finished this and putting it in my.

Speaker 3 (08:35):
Car and we're That's one of the things that the
Alliance that we're telling people protect yourself. You know, get
a dash cam. They're not that expensive and it really
can protect you.

Speaker 2 (08:45):
So that was my next That's where it's going next.
It what do you do just staying on this type
of fraud where an innocent person is sucked into a scheme.
How what's the best ways to protect yourself?

Speaker 3 (08:55):
Well, the first thing, the first thing that I'm telling
people all over the state of New York can is
be aware of your surroundings. Don't tailgate. Tailgating is if somebody,
if I was a scammer and I was a guy
who's gonna stage an accident, somebody's tailgating me, perfect opportunity.

(09:16):
I'm gonna watch in my rear view mirror and see
when that person gets distracted for a second, and then
I'll slam on my brakes, I get hit. Who's at
fault the person who was who was the car in
the rear But in reality, it was a stage accident.
So be aware of your surroundings. If you're involved in
an accident, call the police. Don't ever let somebody say,

(09:40):
oh no, we can handle this without always call the police,
no matter where you are, take pictures, take pictures of
the people, take pictures of the car. And it's really
one of the things that we're telling everybody, and again
not to repeat myself. Get a dash can it you
only can help it can prove you're sure, absolutely absolutely right.

Speaker 2 (10:04):
Now there's so many scams that are just cascading through
my phone as we speak.

Speaker 1 (10:11):
You know your credit thing? Is this?

Speaker 2 (10:13):
Your credit? Is that just for me personally? And by
the way, it's ken dash off from Q one four
point three. I couldn't find my AMEX card. I know
it was in the house. I didn't take it out.
I lost it. I called Amex. They're sending out another card.
I never got the card, and yesterday afternoon, while I
was on the air, three charges came through for three hundred,

(10:34):
five hundred, three hundred dollars in New Jersey wherever. I
called AMEX. I said, I lost my card, but I
thought it was in the house, and they said, no,
these are on your new card. I said, I never
received a new card, and the woman said they must
have intercepted it. We'll send out another card immediately by FedEx.
We'll investigate the charges. So it was the first time

(10:56):
in my life, Frank that I didn't even get the
card and they were able to get it.

Speaker 3 (11:01):
I've I've had over the last ten years, probably five
different American Express numbers, because every once in a while
I'll get a I'll get a like you said, an
email it says, hey, did you make this charge? No, okay,
we'll send you a new card. It happened yesterday. Now
has happened yesterday on one of my old cards. And

(11:21):
I never I never bought anything from this from this
the merchant. Yeah, you know, in one of our campaigns
a few years ago was on cyber fraud. You know,
people have to understand, you know, think before you click,
you know, and it's a great way to avoid, you know,
being a victim of fraud. They don't open up any

(11:45):
any attachment from somebody you don't know, because it could
very well connect you to the dark web and you know,
ruin your life.

Speaker 2 (11:55):
It happens here in iHeartMedia all the time. We get
warnings every week here's the latest scams. If you're invited
to join the team's meeting, make sure it's from somebody inside.
Does it say for Myheartmedia or is it an external link,
or here's the spreadsheet you asked for. You know, there's
always a reason if you're distracted, and it's if I was,

(12:16):
if I'm focused, but now I'm more diligent because even
if you're slightly distracted, Oh yeah, I did ask him
for that, and you don't look to see that it
wasn't the address that you emailed, and it can happen. So, Frank,
you've held leadership roles with the Massachusetts Insurance Fraud Bureau
Collision against Insurance Flora, New York Alliance. You chaired the

(12:37):
public Outreach Committee of the New York Alliance for over
two decades, and so that's next is can you share
how the New York Alliance works with the public, what campaigns,
what tools you do to get this out there.

Speaker 3 (12:50):
So, the New York Alliance was created in nineteen ninety nine,
and the main driver for the creation of the Alliance
was a New York insurance regulations called Regulation ninety five.
And one of the things in that regulation required insurance
companies to advertise about the the subject of insurance fraud,

(13:11):
the pearls of fraud, and the impact of fraud on
the citizens in New York. So a very very enlightened person,
a guy by the named Dennis Jay who was the
executive director of the Coalition Against Insurance Fraud in Washington,
d C. Said here's an opportunity. So he got a
number of companies together and created the Alliance. And what

(13:33):
the Alliance does is our main function is to advertise
to the citizens of the state of New York about
the problem of insurance fraud, how to avoid it, how
to not be a victim, you know, and in New York,
we've got to understand it. When you look at the numbers.
Ken the Coalition Against Insurance Fraud did a study going

(14:00):
back about three and a half years ago on the
extent of insurance fraud. We used to use an eighty
billion dollar number for years. It puts the number now
with three hundred and eight point six billion dollars a
year is the cost of insurance fraud? Say that again,
three hundred and eight billion. They're out an eight point

(14:23):
six billion dollars a year is the overall cost of
insurance fraud.

Speaker 1 (14:28):
That's insane.

Speaker 3 (14:29):
It's insane. Think about this on the on the train
on the way over this morning. I just was googling,
you know, what is how much in the banking industry.
How much fraud is impacting the banking industry, it's about
twenty billion dollars a year. And that includes bank robberies,

(14:50):
includes you know, fraud against the bank. If you get
caught robbing a bank, you're going to jail. We get
caught in committing insurance fraud, there's a good possibility in
some cases you're not going to go to jail. I mean,
think about it for a minute. You know, somebody who
steals five dollars from holding up a gas station, they're

(15:13):
going to go to jail for a long time. Commit
insurance fraud, unless it's a very a very aggressive company,
you may very well not go to jail. But the
good thing about the state in New York is New
York has the most active insurance fraud bureau in the country.
And I'm here to tell you that if you commit
fraud in New York and you're caught, you are going

(15:35):
to go into the system.

Speaker 1 (15:37):
We saw. New York does better than a lot of
other state.

Speaker 3 (15:39):
New York does a lot better than a lot of
other states.

Speaker 2 (15:42):
I'm talking with Frank Stuck, the chair of the Public
Outreach Committee for the New York Alliance Against Insurance Fraud.
He's also senior vice president of Investigative Services at Delta Group.

Speaker 1 (15:53):
And this is CEOs.

Speaker 2 (15:54):
You should know your passion obviously if you started as
a cop and as a detective of.

Speaker 1 (16:01):
Just writing wrongs.

Speaker 2 (16:02):
And that's what I always grew up with, is you know,
help the next person, don't hurt the next person.

Speaker 3 (16:08):
And that's what's driven me all these years. Ken. As
I mentioned before, my dad was a cop. It was
one of the first cops in my hometown. I became
a cop at eighteen years old. My oldest brother is
a retired police officer, and my whole goal was to
help people. Now, the interesting thing that close to ten
years I was a cop before I got hurt, I

(16:30):
never saw a case of insurance fraud because I didn't
know what it was right. So now, one of the
things that we've done, and I've done over the years
is not only educate the citizens of the state of
New York. I talked to police academies. I get cops
to understand that fraud is not just the insurance company's problem.
It's everybody's problem. And to the cops, it's their problem

(16:53):
because they're paying for insurance. The interesting thing when you
look at the numbers from when we take that three
hundred eight point six billion dollar number and calculated down
to the state of New York.

Speaker 2 (17:04):
And.

Speaker 3 (17:06):
It impacts every citizen in New York to the tune
of about nine hundred and twenty dollars a year, not
just the people buying insurance, everybody. And because there's an
impact on the cost of goods and services as well
as the cost of insurance. I mean, think about it,
you're mourning your mourning salad before your lunch. That's a

(17:29):
little more expensive because of insurance fraud. Because that deli
that you go to has to buy insurance, right, their
insurance is more expensive because of insurance fraud.

Speaker 2 (17:39):
You know, there's the large corporations or even mid size
call it trinkage, you know, and they understand that that's theft.
And there are drug stores, especially in the COVID here
in post COVID, the Dwayne read in their neighborhood which
just had an open to a public people who just
walk in, take things and leave, and they didn't get
them a security guard. They didn't have wherewithal the certainly

(18:02):
the young man stocking the shelves is not going to
go fight to somebody. And you know, I sit there
and go, wait, this is our neighborhood store. It's been
there for a long time, and they closed because I
don't know if the company felt it wasn't worth it.
But you see it all the time around us.

Speaker 3 (18:19):
And again, something that I've spoken to I've written about is,
and this is Frank Stuck talking ken, is the decline
in social ethics over the last thirty or forty years. Absolutely,
people are much more. I'm seeing more fraud now in
my career, which is close to forty five years than
I've ever seen before. That stinks, you know it does,

(18:41):
but you know, you.

Speaker 2 (18:42):
Have you know, the economics are very tough. You know,
the cost of living versus wages has never been more
at odds with each other.

Speaker 1 (18:51):
And that's got to be a factor.

Speaker 2 (18:52):
I'm sure COVID was a factor, but still at all
Look look at the damage it's to it.

Speaker 3 (18:58):
I mean, when you think about it, you know it's
every every time someone commits fraud, it affects everybody. You
look at Look at our camp. Our Alliance campaign for
this year is don't get burned by insurance fraud. Very simple.
You know our our TV and radio ads are all
around you know, don't be a victim. If you see something,

(19:20):
say something, you know we we we recommend if people
see fraud occurring a neighbor of business, call the Alliance
eight four four fraud and y call us and report
it to us. You can do it anonymously and will
report it to the State of New York. Or you

(19:42):
can go on our website at fraudany dot com. Report
it to us, will take care of it. We'll get
it reported to the State of New York. And I
guarantee you that if, if, if it is an actual
fraudulent occurrence, it will be addressed by the Fraud Bureau
in the State of New York.

Speaker 1 (20:00):
Frank Stuck, give me the number again.

Speaker 3 (20:02):
Eight four to four fraud and why and what's the
website A fraudan why dot com?

Speaker 2 (20:13):
So guys, why don't everybody if you take a minute now,
just in your phone, just type in or save it,
speak into it fraudny dot com. Because the thing is
that most people, I would guess, if you see something,
say something, but you don't want to get involved. It's
your neighbor, it's the guy across the street. You see
that he's actually using his place as a place of

(20:35):
business or what you know, just but you don't want
to be the bad neighbor. What's this blowback? If you
can do it anonymously and you can just go to
fraudny dot com and give the information without it, or
just call you don't have today, don't ask you for
your name, Nope, and you'll look. So that's a huge
tool to me, because that's next. If it's worse than
it's ever been, are you beaten down by that? Do

(20:59):
you see hope? Is there a way?

Speaker 1 (21:01):
I do see hope?

Speaker 3 (21:02):
And I think that. I mean, if it's a lot
of it's tied to the to the economy. If as
the economy strengthens and we all we all hope it does,
I think there's less of a people will maybe not
be so so what's the word? I want not be

(21:26):
so affected to go and commit insurance fraud? And I
you know, I I saw the on the the information
y'all sent me. Do I have hope for the future. Absolutely?
I have hope for the future. That you know, people
understand from our ad campaigns and the work that we
do in New York that fraud is the crime you

(21:49):
pay for, and that it's not something that we we
we have to put up with anymore. Tell us about
it to me.

Speaker 2 (21:58):
You know, I've heard that phrase said, oh, you know
those insurance companies, they got plenty of money. Come on,
they got plenty of money. Well, they do have plenty
of money, but there's also a lot of money going out.
And the way I look at it is, you know
the fruit cart on my corner, if the guy could
go to the bathroom, I could take a bit. I

(22:19):
could take fruit and he would never know it. But
why would I do it?

Speaker 3 (22:23):
It's stealing.

Speaker 1 (22:24):
It's stealing.

Speaker 2 (22:24):
So whether you're stealing from the poor guy in the
corner or you're stealing with from a major insurance company,
guess what it's called stealing.

Speaker 3 (22:33):
And and again go back to one of the comments
I made earlier is that, you know, people have to
understand that it's not a cool thing to do anymore.
That you know, and when I talk about that quote
honest person who's committing fraud, you know, people have to
understand that every time somebody lies on their application for
insurance or commits a little bit of insurance fraud, it

(22:56):
hurts everybody. You know, twenty dollars year for every person
in the state. That's a lot of money.

Speaker 1 (23:04):
Do you think we can knock that down?

Speaker 2 (23:05):
If this got more, if we were all more proactive.

Speaker 3 (23:09):
I believe we can. Sure, So it's hoarded to us.

Speaker 1 (23:12):
Frank Stuck, chair of the Public Outreach Committee for the
New York Alliance Against Insurance Fraud. What's next for you?
Or do you want to just keep rolling with that now?

Speaker 3 (23:20):
People ask me all the time, I can I speak
all over the country on fraud.

Speaker 1 (23:25):
Oh?

Speaker 3 (23:25):
Actually, I've done it internationally as well, And people say, Frank,
when are you going to stop?

Speaker 1 (23:30):
When?

Speaker 3 (23:30):
I when I stop having fun? And what I mean
by that is every time I go out and do
a presentation, I know that people are hearing the message.
And you know, I've been doing this for a long time.
I've probably done over three thousand presentations on insurance fraud
and people listen and like with our campaign starts in

(23:54):
May and and it's ending now in the state of
New York. Our our ad campaign every year, the number
of calls we get goes up during that period. The
number of calls that the State Fraud Bureau gets goes
up during that period because people understand that. You know,
why do I have to pay for this? Yeah, you

(24:16):
shouldn't have to.

Speaker 2 (24:17):
Once again the number eight four four fraud? N why
eight four to four fraud and why? Or just go
to fraudli dot com. See something, say something. It's what
the police tell us about being on the subway stations,
It's what I do at the airports, and.

Speaker 1 (24:33):
This is what we have to do to take care
of ourselves.

Speaker 3 (24:35):
And don't get burned by insurance fraud.

Speaker 2 (24:38):
Frank Stuck, thanks so much for coming on CEOs. You
should know at iHeartMedia appreciate you.

Speaker 3 (24:42):
Thank you so much to you and iHeart for letting
us tell our story.

Speaker 1 (24:46):
My pleasure
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