Copyright held by The John Cooke Fraud Report. Reprint rights are granted with attribution to The John Cooke Fraud Report with a link to this website.
They’ve been at it for a year and efforts thus far have saved a whopping $350,000 in bogus claims. Since the program began in March 1995, Crime Stoppers has received 370 insurance fraud tips from Canadian citizens interested in cutting down on fraud.
The tips have been used to arrest 15 people and deny 13 claims valued at $350,200.
The Candian Coalition Against Insurance Fraud is a joint effort between more than 70 insurance associations, police and fire organizations and consumer groups.
Connecticut State Police have arrested Dennis and Carol Steiger of Old Lyme and charged them with felony counts of arson, conspiracy to commit arson, insurance fraud and conspiracy to commit insurance fraud. To round out the list, they were also charged with making false statements to officers.
Investigation revealed the Steigers had complained for many years about the poor quality of their house. They sued the builder for a lengthy list of things: a toilet that was not hooked up, a nonfunctional ceiling fan, improperly installed tiles and septic gases that would not vent. While the court ordered the builder to pay $26,000 for repairs and $7,500 to reimburse attorney’s fees, the Steigers thought it was not enough to complete the necessary repairs.
It’s happening across America. Insurance agents, for myriad reasons, are being arrested and charged –
*
In Boca Raton, Florida, Mary Zelnar Cacossa asked the judge for a court-appointed attorney because she was too poor to afford legal counsel. The judge didn’t buy her plea of poverty and ordered Cacossa to go hire her own attorney. The agent was charged with organized fraud, transacting insurance without a license and obtaining/retaining money dishonestly. In many cases, policy applications and premiums collected were never remitted to insurance companies and the Insurance Commissioner’s Consumer Services Office in West Palm Beach received more than 80 complaints about Cacossa.
*
In Gilroy, California, the garlic capitol of the world, Matthew Warrenton Shack, who operated under the business name of Matthew Shack Sr. Insurance Services, was found to be collecting premiums for commercial and personal auto policies but failing to secure any insurance for his customers. The victims included cab drivers, truckers and other commercial and high risk drivers.
In one case, a San Jose dump truck driver paid Shack more than $4,000 for commercial liability insurance that was never provided, and Shack issued phony certificates of insurance which falsely represented that the dump truck driver was insured. Chuck Quackenbush, Insurance Commissioner for the State of California, summed it up when he stated, “Something stinks in Gilroy – and we’re not talking garlic.”
*
And there’s a sad story from Pennsylvania, too. A Westmoreland County insurance agent who stole more than $146,000 he received from eight elderly consumers for the purchase of annuity policies was sentenced to prison and ordered to make full restitution. John J. Hunter of Lower Burrell was arrested by agents of the Attorney General’s Bureau of Criminal Investigations and charged with nine counts of theft by failure to make required disposition of funds received. He pleaded guilty to the charges and surrendered his insurance license. Hunter collected the money, $146,690 to be exact, over a seven-year period and never forwarded the consumers’ checks to the insurance companies. Instead, he deposited the checks into the bank account of his own independent insurance business, Hunter Insurance Agency, and used the money to pay business and personal expenses. Hunter stole $60,000 from one elderly woman and $35,000 from another woman, who told investigators that the $35,000 Hunter took from her represented her life savings.
*
Thomas K. Monahan, a former Santa Rosa, California, insurance agent, pleaded guilty to five counts of theft for stealing $207,000 from two elderly insurance clients. The senior citizens thought they were purchasing annuities, but the money landed in Monahan’s pocket instead.
*
In Indiana, husband and wife Wanda and William Stillwell are wearing his-n-her prison garb as they serve time in a federal penitentiary. The Stillwells discovered a good way to bring extra cash into their co-owned Martinsville insurance agency, W.I. James & Sons. Finance contracts!
Many of the agency’s clients were purchasers of large-dollar commercial policies, so the Stillwells had arrangements with a number of premium finance companies. The husband/wife team soon learned how easy it was to fill out finance contracts for bogus clients and nonexistent policies. In one particular case uncovered during the investigation, the address listed for the client was part of a student housing tract and the phone number was that of William Stillwell’s beeper.
© Copyright 1996 Alikim Media