Allstate owed $7 million after chiropractor inflates auto accident claims

Allstate Insurance Company has won a $7 million judgment against a chiropractor and his businesses in a federal racketeering lawsuit that alleged the chiropractor conspired to submit inflated claims for patients injured in auto accidents.

A federal jury sided with Allstate in June, and earlier this month U.S. District Judge James Mahan issued the final monetary judgment.

The judgment sets the stage for the company to “vigorously fight” medical fraud in Nevada and across the country, Allstate spokesperson Chelci Vaughan said Wednesday.

“Medical insurance fraud affects all policyholders’ premiums, and it’s not fair for consumers to pay higher rates for criminal behavior,” Vaughan said in a news release. “We are committed to protecting our customers from being victimized by this type of fraud.”

The racketeering complaint, the first of its kind brought by Allstate in Nevada, was filed in 2008 against chiropractor Obteen Nassiri and his businesses: Advanced Accident Chiropractic Care, ONN Management, Digital Imaging Services and Digital X-Ray.

Nassiri’s chiropractic license was revoked in Nevada in December 2010.

The suit alleged that Nassiri, as early as 2003, accepted auto accident victims to his clinics for unnecessary medical consultations and expensive diagnostic studies in an effort to generate more revenue and profit.

Nassiri was alleged to have provided unnecessary and excessive treatment, charged for treatment that never occurred, grossly misrepresented billing and exhibited a general pattern of illegal and fraudulent conduct.

The jury at trial also found Nassiri’s wife, Jennifer Nassiri, liable for negligent misrepresentation in the overall fraudulent scheme to harm Allstate.

The monetary award means Allstate will recover money from more than 150 auto accident claims involving fraud, Vaughan said.

“It is especially disturbing when medical professionals violate their oaths and abuse the public’s trust,” Vaughan said. “This judgment should send a strong message to unscrupulous providers and would-be criminals that Allstate maintains a zero-tolerance approach in the fight against insurance fraud.”

Contact reporter Jeff German at or 702-380-8135. Followhim on Twitter @JGermanRJ.

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