New York S 9135: Enacts the "fraudulent claims reduction and unlawful deception act"

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S09135 Summary:

BILL NOS09135 

&nbsp

SAME ASSAME AS A10224

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SPONSORCOONEY

&nbsp

COSPNSRADDABBO, FERNANDEZ, GOUNARDES, SEPULVEDA, SKOUFIS, SUTTON

&nbsp

MLTSPNSR

&nbsp

Amd §176.00, add §§176.90 & 176.95, Pen L; add §412, Ins L

&nbsp

Enacts the "fraudulent claims reduction and unlawful deception act" or "FRAUD act"; establishes the crimes of staging a construction site accident for insurance fraud and auto insurance fraud involving staged collisions and fabricated claims; provides for enhanced penalties and enforcement for construction site and auto claims fraud.

Go to top S09135 Actions:

BILL NOS09135 

&nbsp

02/05/2026REFERRED TO CODES

Go to topS09135 Committee&nbspVotes:

Go to topS09135 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topS09135 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 9135

 IN SENATE

 February 5, 2026
 ___________

 Introduced by Sen. COONEY -- read twice and ordered printed, and when
 printed to be committed to the Committee on Codes

 AN ACT to amend the penal law and the insurance law, in relation to
 establishing enhanced criminal penalties for fraudulent insurance
 claims on construction sites and in motor vehicle accidents

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. Short Title. This act shall be known and may be cited as
 2 the "fraudulent claims reduction and unlawful deception act" or "FRAUD
 3 Act".
 4 § 2. Legislative findings and intent. The legislature finds that frau-
 5 dulent insurance claims, including staged construction site accidents
 6 and staged motor vehicle collisions, contribute significantly to
 7 increased insurance premiums in New York state. Fraudulent claims
 8 inflate costs for insurers and policyholders, burden taxpayers, and
 9 undermine the affordability of housing, infrastructure development, and
 10 transportation projects. The state's current liability and insurance
 11 frameworks, including outdated doctrines that create perverse incentives
 12 for litigation rather than safety and accountability, have led to a
 13 proliferation of staged accident claims and opportunistic lawsuits,
 14 which in turn raise construction and auto insurance costs for all New
 15 Yorkers. This mirrors concerns expressed about liability standards
 16 driving fraudulent suits and higher premiums. High insurance costs for
 17 construction and automobile coverage contribute to the overall cost of
 18 housing, public works, and commuter mobility, making New York less
 19 affordable compared to other states. The purpose of this act is to deter
 20 and punish the intentional staging or fabrication of insurance claims
 21 related to construction site accidents and motor vehicle collisions, by
 22 establishing clear criminal penalties, restitution requirements, and
 23 enforcement mechanisms. In doing so, this act seeks to reduce fraudulent
 24 activity that drives up insurance costs, thereby making insurance cover-
 25 age more affordable, promoting the efficient use of public and private
 26 funds, and restoring fairness in liability and insurance practices
 27 across the state.

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD14752-01-6

 S. 9135 2

 1 § 3. Subdivision 3 of section 176.00 of the penal law, as added by
 2 chapter 720 of the laws of 1981, is amended and four new subdivisions 6,
 3 7, 8 and 9 are added to read as follows:
 4 3. "Person" includes any individual, firm, association [or], corpo-
 5 ration, a purported injured worker, attorney, physician, medical profes-
 6 sional, or any other individual who knowingly participates in, facili-
 7 tates, or furthers conduct prohibited by this article.
 8 6. "Fraudulent insurance claim" means a claim submitted to an insurer
 9 that is intentionally false, misleading, fabricated, or made with the
 10 intent to obtain benefits not legally due.
 11 7. "Construction site" has the same meaning as "workplace" and "work-
 12 site" as defined in section two hundred of the labor law, the meaning
 13 applies where such construction work is being done as defined in section
 14 two hundred forty of the labor law and incl