Pittsburgh Agency Shut for Alleged Premium Fraud

February 22, 2011

The Pennsylvania Insurance Department has shut down Pittsburgh-based Morry Hoffman Agency Inc. for allegedly misappropriating $1 million in premiums.

The agency wrote commercial policies for restaurants including liquor liability coverage. Within a two-year timeframe, the department discovered that the agency failed to forward more than $1 million in premiums on behalf of their clients to numerous insurance companies and agencies.

“These actions jeopardized customers who purchased insurance through Morry Hoffman in good faith. Consumers who used this agency should contact their insurance companies immediately to verify that their policies are current and in effect,” said Ron Gallagher, deputy insurance commissioner for the Office of Market Regulation.

As part of a settlement agreement, the department said it revoked the agency’s insurance license. The department said it had previously revoked the license of Marjorie Dee Rothrauff, the agency’s designated licensee. The agency president, Carol Hughes, is unlicensed and cannot legally transact the business of insurance, according to officials.

In addition, the department said it referred the case to the Pennsylvania Office of Attorney General for a possible criminal investigation.

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