Fraud Roundup
Five contractors arrested in Lake Tahoe
California Insurance Commissioner Steve Poizner announced the results of the first undercover operation stemming from the Angora Fire in South Lake Tahoe. The operation took place at a residence in the disaster area that was damaged by fire, but not destroyed.
On July 4, the California Department of Insurance’s Enforcement Branch partnered with investigators from the El Dorado County District Attorney’s Office and the California Contractors State License Board to identify unlicensed public adjusters as well as unlicensed and uninsured contractors. The operation resulted in five arrests. The El Dorado County District Attorney’s Office is prosecuting the cases.
None of those arrested possessed either a city/county business license or a contractor’s license. Furthermore, two arrestees did not have workers’ compensation insurance. Suspects arrested were:
• Steve Killion of Marysville, Calif., co-owner of Rossier Home Restoration;
• Kurt Edward Kimm of Placerville, Calif., owner of Kurt Kim Trucking and Equipment;
• Troy Meadows of Gardnerville, Nev., co-owner of B&T Services;
• Chase Rossier of Yuba City, Calif., co-owner of Rossier Home Restoration; and
• William Tanner of Gardnerville, Nev., co-owner of B&T Services.
Investigators have been sweeping the disaster area to verify the license and insurance status of persons identifying themselves as public adjusters or contractors, CDI said.
Agent charged in auto fraud scam
California Insurance Commissioner Steve Poizner announced that a California Department of Insurance (CDI) investigation has exposed the fraudulent activity of Newport Beach, Calif., resident and former insurance broker, Thomas Joseph Doino. Doino allegedly kept over $7,000 in auto insurance premiums he collected from customers.
In 2004 and 2006, CDI said Doino collected more than $7,000 in auto insurance premiums from at least 11 victims. He provided his customers with phony insurance cards and receipts, leading them to believe they were purchasing valid policies. Instead of forwarding the premium payments to the insurance companies, Donio pocketed the premiums.
Three of Donio’s victims discovered his scam after they were involved in car accidents and attempted to file claims with their insurance companies. The victims are facing more than $10,000 in losses because of Donio’s scheme.
Donio was charged with 11 counts of felony grand theft on June 21, 2007, in Orange County Superior Court.
Man mangles hand in scam
A man who allegedly tried to burn down his recently remodeled house now has a mangled hand and is facing arson and fraud charges.
Sutter County prosecutors say 29-year-old Juan Jose Luna was trying to collect insurance money on his home in Live Oak, Calif.
Instead, prosecutors say Luna set off an early morning explosion that blew out the walls and sent glass flying 90 feet.
“Some type of accelerant” was being used, but it exploded rather than burned when it was ignited, Sutter County Undersheriff J. Paul Parker said.
Luna was found wandering two blocks from the burning house with a badly injured hand after the explosion June 12. Luna lost at least one finger, said Live Oak Fire Capt. Dan Yager.
Luna isn’t talking to investigators, Parker said. He is free on $100,000 bond while he awaits a July 23 arraignment in Sutter County Superior Court.
Agent sentenced for grand theft
A Southern California agent has been convicted of one felony count of grand theft and sentenced to serve jail time and pay full restitution to her victims for stealing more than $11,000 from her clients.
According to California Department of Insurance investigators, Alice Linda Constantine (AKA Alice O’Neil and Alice Beard) stole more than $11,000 from her clients over a period of five years. She pleaded guilty to one felony count of grand theft. Constantine collected premiums and issued fraudulent Acord certificates of insurance to at least six consumers for commercial liability coverage. Constantine failed to send the premiums to the insurance company.
As part of the plea agreement established June 15, 2007, Constantine was ordered to pay full restitution to her victims, serve 18 days in county jail, complete 100 hours of community service and three years supervised probation. It was additionally ordered that Constantine no longer be employed in the insurance industry.
Calif. agent arrested
Merilyn Matsuko Burnside, an insurance broker from Commerce, Calif., has been arrested for allegedly swindling customers out of insurance payments on two separate occasions, announced the California Department of Insurance. Burnside was arrested July 6, 2007, in her city of Commerce office.
CDI investigators revealed that Burnside allegedly defrauded one victim of $3,532 by pocketing the customer’s insurance premium payment instead of remitting it to the insurer. As a result, the victim’s property was uninsured, and he was exposed to potential losses for 12 months.
The victim discovered the scam when attempting to renew coverage a year later. He then submitted a written request for assistance to the Department of Insurance.
Upon receiving the request, CDI launched an investigation of Burnside’s business.
During the course of the CDI investigation, a second alleged fraud victim was discovered.
The second victim had paid Burnside $799 for his insurance premium. Instead of remitting it to the insurer, the broker allegedly stole the premium money and left the victim exposed to potential losses for 10 months. The victim was unaware that his property was uninsured until the investigation uncovered Burnside’s offense, CDI said.
Burnside’s arraignment date is scheduled for July 27. The Los Angeles District Attorney’s Office is prosecuting the case.
Burnside’s business operated under the name, “M. Burnside Insurance Brokers, Inc.,” CDI said.
Nevada launches campaign against fraudulent annuities insurance
The Nevada Division of Insurance has launched a campaign to address fraudulent annuities insurance programs.
According to the Division, there has been a recent increase in fraudulent annuity investment claims in Nevada and nationwide. To help educate consumers, its advertising campaign, titled “Bad Animals” simulates conversations between annuity “sales people” who are really “animals” underneath the surface. The kitschy yet serious message should encourage consumers to understand their annuities and clearly know its benefits and risks, as well as who they are purchasing from, the Division said.
The campaign also informs consumers that to research their investment/annuities company, they can log on to www.nvinsurancealert.com, or call 888-467-4195 to verify whether their provider is an authorized and legitimate supplier of annuity products.