GEICO has hauled a Queens-based medical equipment supplier into federal court, accusing the company of juicing prescriptions and puffing up bills in a No-Fault kickback scheme that allegedly churned out more than $1.2 million in charges, according to court records. The May 26, 2026 complaint, filed in the U.S. District Court for the Eastern District of New York, names ROM DME Inc. and its owner, Avraam Shimonov, as defendants.
As reported by Insurance Business, ROM DME allegedly billed GEICO for more than $1.2 million between March 2024 and February 2025, with the insurer paying out in excess of $1 million before hitting the brakes. GEICO is now contesting roughly $500,000 in additional pending claims and is asking the court to declare that it does not have to pay those bills at all.
Company history and prior litigation
This is not ROM DME's first appearance in an insurance fight. State court records show the supplier listed among defendants in a 2025 New York County action involving disputed billing practices. The 2026 state decision can be read via Justia.
What the filing alleges
The complaint, summarized by Insurance Business, claims prescriptions were “stamped, photocopied, and/or electronically generated,” while delivery receipts supposedly showed “glaring inconsistencies” in patient signatures. The filing drills into specific HCPCS billing examples that GEICO flags as suspicious.
According to the lawsuit, ROM DME allegedly selected higher-paying codes for vague prescriptions, such as billing L0650 at $563.60. In another example, the company is accused of listing an egg-crate mattress under code E0272 at $118.19 when patients allegedly received a topper reimbursable at $19.48. GEICO also says ROM DME billed T5001 for an “orthopedic car seat” at $574.58 while patients reportedly received positioning cushions reimbursable at about $22.04.
Legal stakes: RICO and damages
GEICO's lawsuit brings six causes of action, including civil RICO claims under 18 U.S.C. § 1962(c) and (d), plus common-law fraud, unjust enrichment, and aiding and abetting fraud. The insurer is seeking treble damages, punitive damages, and attorneys’ fees.
Under 18 U.S.C. § 1964, a private civil RICO plaintiff can recover threefold damages and costs if injured in business or property by a violation of § 1962. If GEICO can prove its case, that multiplier could turn the alleged loss into a significantly larger judgment.
Why this matters in New York
New York's No-Fault system provides Personal Injury Protection benefits that cover basic economic losses up to $50,000 per person. Insurers argue that large, inflated DME claims can drain that pot quickly, leaving less coverage for actual medical care and lost wages. For a primer on the no-fault cap and how disputes get handled, see Justia's overview.
GEICO has been busy on this front. For context on its other New York filings this month, Hoodline recently highlighted a similar GEICO filing earlier in May involving alleged overbilling by another supplier.
The allegations in GEICO’s new complaint against ROM DME remain unproven. The case still has to run the gauntlet of motions, discovery, and any dispositive rulings before a court decides liability or damages. Upcoming entries on the federal docket will show whether ROM DME or Shimonov answer the complaint or move to dismiss in the weeks ahead.
