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The California Riverside County District Attorney’s office had a press conference yesterday with Dave Jones, the California Insurance Commissioner. The Department of Insurance gave District Attorney Paul Zellerbach $2.4 million in grants to fight insurance fraud.

$1.4 million is earmarked for attacking workers’ compensation fraud exclusively.

According to the belief of DA Paul Zellerbach, the present and recent-past tough economic times have caused a rise in automobile insurance fraud together with workers’ compensation fraud. Zellerbach also mentioned the rise in life and annuity fraud, and stated that he knows his office has its work cut out for it.

The grant money will provide salaries and benefits for five prosecutors, seven investigators, one paralegal and one investigative technician.

Dave Jones explained how the losses from fraud are not just to the insurers and the state. He laid out how workers’ compensation fraud drives up the cost of workers’ compensation insurance itself and hurts the businesses. Jones also stated that auto insurance fraud drives up the price of automobile insurance for consumers.

Dave Jones explained how the grant comes from the insurers via the assessments on insurance companies. He said the state Legislature years ago authorized a series of grant programs funded by these assessments. It’s the fact that this money does come from the insurance carriers that has given Sim Hoffman, M.D.’s defense attorney, Richard Moss, the idea that he can justify his 995 motion to attack the workers’ compensation fraud case against Sim Hoffman and his consorts by the Orange County District Attorney by stating the OCDA is in a conflict of interest. Moss has cited case law that defends his notion that the complainant cannot subsidize a DA’s investigation. However, according to Orange County Deputy District Attorney Shaddi Kamiabipour, who is prosecuting Sim Hoffman, this argument is highly unlikely to prevail.

Cumulatively, this new money for Riverside County for 2013 will cover investigations for workers’ compensation fraud; what is referred to as regular automobile insurance fraud by individuals; and organized auto insurance fraud conducted by rings that conspire to stage accidents, then collect and divide the profits amongst its members.