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Man faces charges for selling fake insurance policies

On Behalf of | Jul 10, 2021 | White-Collar Crimes |

When individuals purchase insurance, they expect their policies to protect them. They are willing to pay premiums, sometimes for many years, for the comfort of knowing the policy will be there if they need it, such as after a motor vehicle accident, the death of a loved one or damage to their homes during a Florida storm. When an agent is accused of committing insurance fraud, it can cause widespread uncertainty and financial distress. Therefore, authorities come down hard when they suspect someone of involvement in such schemes. 

Purchasing an insurance policy takes a certain amount of trust and often considerable expense, especially if the premiums are high. When an agent sells fraudulent policies to collect the premiums, it can be disastrous for the policyholders who expect to be covered when they need their benefits. Federal authorities believe one Florida insurance agent diverted the premium payments from customers for more than seven years instead of applying the money to their policies.  

Insurance premium diversion 

The agent, allegedly gave his customers documentation for policies that did not exist, and he is accused of keeping their monthly payments to use for his own purposes. Unless a customer files a claim, such fraud may go undetected for years. This is called premium diversion, and it carries significant penalties. FBI agents maintain that the agent diverted more than $4 million from his clients. 

Federal agencies worked with the state of Florida during their investigation of the 51-year-old man. They continue to search for others who may have purchased policies from him. He now faces insurance fraud and wire fraud charges, which may include extended time in prison and thousands in fines if a court convicts him.