Caffery, Oubre, Campbell & Garrison, L.L.P.
New Iberia
Service, Integrity, Results

Clever fraud scheme by agent still results in guilty verdict

As we have noted from time to time, insurance fraud is an area where those willing to cheat, steal and defraud insurance companies often come up with novel new ways to turn a profit, at least temporarily.

Most people have heard of some common insurance fraud schemes, such as filing for false damage claims on homeowner policies or more elaborate scams involving faked  or staged car accidents with property damage claims or personal injuries. And there are fraudulent medical service providers, where doctors or their staff may create billings for phantom patients.

From Florida comes news of this scam, where the fraud was engineered by the an insurance agent. The agent apparently set up a fake business, where he induced hundreds of people into believing they were applying for a job with his company.

He then used the information to submit life insurance applications, which he claimed were a benefit of the job. He paid the initial premium and received commissions and bonuses for all of these new policy "sales" from an insurance company.

He seems to have had it all figured out, as he "earned" hundreds of thousands of dollars from these commissions. He let all of the policies lapse and unsurprisingly, the company recognized they had been subjected to a large fraud. The state filed criminal charges against the former agent and he was convicted at a bench trial of money laundering and racketeering.

He could be sentenced for up to 60 years for his crime.

We wonder how he believed he would not be caught. Insurance fraud usually creates a detailed, even if fake, paper trail, which eventually comes to light and with it, the end of the criminal enterprise., "Florida Insurance Agent Found Guilty of Racketeering, Money Laundering," April 14, 2015

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