Michigan man gets prison time for faking arm amputation in insurance scheme

Kevin Lyons

A Michigan man faked the amputation of his left arm in an attempt to file a $251,000 insurance claim. But authorities caught on to the ruse and handed the would-be amputee nearly five years in federal prison.

This case “just goes to show that people who have a history of committing scams are always thinking of new and innovative ways to game the system,” says Frank Scafidi, a spokesman for the nonprofit National Insurance Crime Bureau.

Michael Earl LeDuc, 33, pleaded guilty Aug. 18 to a federal charge of wire fraud in connection with the fake amputation case. In federal court in Marquette, Mich., he was sentenced to 57 months in prison along with three years of supervised release after completion of his prison term.

LeDuc is from Escanaba, a town in Michigan’s Upper Peninsula.

Fraudster bought $500,000 policy

This story began in 2009, when LeDuc purchased a $500,000 accidental death and dismemberment insurance policy from Wisconsin-based CUNA Mutual Group. In August 2010, LeDuc filed an online dismemberment claim with CUNA, saying part of his left arm had been lost to a wood chipper three months earlier.

After a CUNA claims investigator asked LeDuc to provide medical records to support his claim, LeDuc mailed documents to the CUNA claims center. Those documents purported to show he’d received inpatient treatment at OSF Saint Francis Medical Center in Escanaba on May 8-10, 2010, as a result of the accidental amputation of his left arm below the elbow.

According to court records, LeDuc provided these fake documents by modifying authentic medical records he previously had gotten from OSF Saint Francis. The CUNA policy would have paid LeDuc $251,000 had his left arm actually been amputated.

Sending these fraudulent documents to CUNA and making a number of telephone calls across state lines to check on the status of his claim led to the federal charge of wire fraud against LeDuc.

The fraud falls apart

LeDuc’s insurance fraud scheme unraveled when the CUNA investigator showed the fake documents to the records manager at OF Saint Francis, who confirmed the documents had been altered.

The Escanaba Police Department stepped in, and detective Anthony LaPlant (who went to high school with LeDuc) visited LeDuc’s home to question him. LeDuc invoked his right to remain silent.

“I noted that LeDuc had both arms and neither appeared to be injured,” LaPlant said in the federal government’s criminal complaint.

Other crimes uncovered

That’s not all that authorities noted, however. In the process of investigating the CUNA fraud case, authorities discovered several other fraudulent acts committed by LeDuc. In his plea agreement, LeDuc admitted:

• Filing a false insurance claim with Standard Insurance Co. of Portland, Ore., for a serious head injury.

• Filing a number of false insurance claims with Aflac.

• Selling an ATV on eBay for $1,500, then keeping the money but not delivering the vehicle.

• Buying gasoline for his gas station from four companies using bounced checks, forged letters of credit and a variety of fraudulent statements.

LeDuc agreed to pay full restitution for the losses he caused in committing these crimes.

To read federal court documents about the LeDuc case, visit http://goo.gl/V9nFZ.