Massage therapist
gets probation for fraud

A judge orders the woman to pay more
than $22,000 in fines, fees and restitution

A 41-year-old massage therapist was sentenced to five years' probation and ordered to pay restitution, fines and fees totaling more than $22,000 for submitting fraudulent billings to an insurance company for hundreds of massages she claimed she and others provided to a Wahiawa family.

Clara O. Sharkey, a licensed massage therapist from Hawaii Kai, pleaded no contest in March to two counts of insurance fraud, two counts of second-degree theft and one of racketeering in a scheme that occurred in 2001.

She claimed to have provided 356 treatments over a four-month period to 11 family members, including a 4-year-old, after they were involved in a car accident. The state charged Sharkey with falsely billing AIG Hawaii Insurance Co. for 144 treatments that she had two massage therapist friends sign for, though they had not provided the services.

Circuit Judge Derrick Chan rejected Sharkey's request to defer her plea, noting that her actions occurred over a period of time and involved covering up after state insurance fraud investigators were alerted. But he decided against ordering jail time because of the substantial fines he imposed.

Colleen Chun, head of the state Insurance Fraud Investigations Unit, opposed a deferral and argued for probation and at least six months in jail.

To cover up the fraudulent billings, Sharkey remained at the family's home until 1 a.m. one day to ensure she spoke to all the family members, urging them to lie to the investigators. She also involved two friends in her scheme who falsely represented that they provided 144 treatments that cost the insurance company $11,970, Chun said.

Defense attorney David Hayakawa argued for the deferral, saying Sharkey has taken responsibility for her actions and is ready to submit restitution of $11,970 in full.

"This was a terrible mistake, and the cover-up was a complete panic," Hayakawa said. The friends agreed to sign the paperwork confirming they provided the therapy because they were worried about her and what she would do if they did not go along with it, he said.

The family did not seek medical attention, but it was Sharkey who went to their home and offered her services after hearing about their accident from a relative, state investigators said.