S. Fla. Agent Arrested for Switching Policies, Defrauding Seniors

August 22, 2005

An insurance agent who targeted victims between the ages of 72 and 86 and fed on their fears about aging has been arrested for allegedly defrauding at least nine South Florida senior citizens by offering them a quote for one level of long-term care insurance, but selling them another.

According to Florida’s Chief Financial Officer Tom Gallagher, Ronald S. Rogart, was arrested in Gilchrist County, but lived in Miami Beach during the investigation by the Department of Financial Services’ Division of Agent and Agency Services, Bureau of Investigation, and the Division of Insurance Fraud. The alleged fraud occurred between 2002 and 2004. The department revoked Rogart’s agent licenses in December.

Rogart is charged with nine counts each of elder exploitation and insurance fraud. The victims lived in Palm Beach and Broward counties, where Rogart ran local newspaper advertisements offering long-term and home health care programs under the name of “South Florida Senior Advisors.”

Rogart would meet at the customer’s home or apartment where he would explain coverage levels from a variety of insurance companies. But detectives said the prices he quoted were less than the actual cost of the policy, so Rogart would submit an application that reflected a lower level of coverage that matched the quote he gave the customer. When Rogart received the policy, he would replace the real schedule page with a forged one so the clients didn’t know they had been sold less coverage than what they had asked to buy. But a customer filed a complaint after a door-to-door insurance agent pointed out disparities in the policy.

TRG Operators Sentenced; Authorities Seek $6M Restitution

Attorney General Charlie Crist has announced that two individuals have received prison sentences for their roles in an insurance scam. William Paul Crouse and Carmelo Zanfei-the principals of TRG Marketing LLC-were sentenced for selling unauthorized health plans to more than 7,000 Floridians, resulting in millions of dollars of unpaid claims.

Crouse and Zanfei marketed a self-insured health plan to citizens of Florida and 43 other states without seeking a certificate of authority to sell the plan. They claimed that the plan was exempt from the licensing and certification requirements of state law. Investigators determined the health plan was insufficiently funded and the company failed to pay millions of dollars in claims. The affected Floridians could receive more than $3 million in restitution, ranging from $200 to $200,000 per victim.

S. Fla. Cousins Receive Prison Terms, Ordered to Repay $1.5M

Three people who were involved in an insurance scam that targeted elderly Southwest Florida residents were sentenced and told to repay their victims $1.5 million.

Three South Florida cousins, Brian Shechtman, Dean Shechtman and Brad Shechtman, were sentenced to prison by Lee Circuit Judge Thomas S. Reese for scheming to persuade seniors aged 75 to 94, to switch their health insurance to low-cost health insurance, over-bill them, and apply the extra money to life insurance policies. The Shechtmans, who operated the Elder Care Insurance Agency and Golden Senior Benefits, pleaded guilty in March to racketeering charges.

The trio raked in more than $2 million in commissions before their scheme was discovered and were ordered to pay $1.5 million in restitution to the victims as a condition of probation. Brian Shechtman received 10 years in prison, but on the provision that if he completes two-and-a-half years with good behavior, he will be released on probation. Dean and Brad Shechtman each received one year in prison and 10 years probation.

Rosemary Welstead, the firm’s office manager, was sentenced to nine years in prison, but received one year of community control and eight years on probation. Camille Martinez Shechtman, Brad’s wife, and an agent for the company, was sentenced to eight years in prison, but her sentence was suspended on the condition she completes 10 years of probation.

N.C. PEO Operator Apprehended for Pocketing $3.8 M

A grand jury in Greensboro, N.C., has indicted Steven E. Edwards on 21 counts of fraud, money laundering, tax evasion and stealing $3.8 million earmarked for health and workers’ compensation insurance from three employee-leasing businesses.

According to a news release issued by the U.S. Attorney’s Office for the Middle District of North Carolina, the former Durham resident was arrested in Chanute, Kan. Prosecutors think Edwards pocketed the money and used it to buy a mountain villa in Boone as well as maintain a collection of expensive vehicles and motorcycles.

The affected employees worked for companies based in North Carolina, California, Florida, Kansas, Michigan, Mississippi, Oklahoma, South Carolina and Tennessee, the indictment states.

Edwards ran three businesses, Magna Corporation, Nations Group and Integrity Corporation, from a Durham office but based the companies’ operations in Kansas. The businesses, considered Professional Employer Organizations, contracted with smaller businesses to manage insurance and payroll for those companies.

Federal prosecutors think Edwards collected money from January 1999 to April 2001 from his contracted clients but never took out workers’ compensation or health insurance for thousands of affected employees, who were left without coverage, according to the indictment unsealed.

Ga. Patient Apprehended; Claimed to be Hospitalized While at Work

Patience D. Minor of Columbus, Ga., is being held without bond in Muscogee County Jail charged with 11 counts of insurance fraud. The Georgia Insurance Commission conducted an investigation and alleged that Minor filed bogus claims totaling $8,300 on her American Family Life Assurance Company of Columbus group health insurance policy.

Insurance Commissioner John W. Oxendine issued an announcement indicating that Minor made bogus claims between August 2003 and January 2005. They were discovered after Minor’s employment records were reviewed. An investigation revealed that she was at work on many of the days she claimed to be hospitalized.

From This Issue

Insurance Journal West August 22, 2005
August 22, 2005
Insurance Journal West Magazine

Contractors Issue

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