View this article online: https://www.insurancejournal.com/news/southcentral/2003/06/16/29873.htm
Oklahoma Insurance Commissioner Carroll Fisher placed a Bethany insurance agency into supervision after learning that its owner may have stolen more than $100,000 from her customers in the form of refunds she hid from them.
Aviation Insurance Group Agency was placed under supervision and the licenses of, its owner, Shirley B. Porter-Hart of Piedmont, and its vice president, Cynthia B. Pennington of Bethany, were suspended following an investigation into the allegations.
In addition, Fisher appointed a supervisor for the agency to oversee payments to policyholders. It is believed this is the first time an Oklahoma insurance commissioner has placed an agency into supervision, although the practice is common when insurance companies have financial difficulties.
Porter-Hart and Pennington are alleged to have pocketed money refunded by the companies they represented to their customers. In most cases, money was refunded to the agency after policies were cancelled early but the agency did not notify the policyholders, eventually moving the money into its own accounts.
In some cases, policyholders were aware refunds were due, but agency employees were told to withhold 5 percent. Policyholders were not told money was withheld from their refunds.
“This is a case in which I have determined that since the agency is unable to pay its policyholders what they are owed, the Oklahoma Insurance Department will take all steps possible to make sure they are,” Fisher said.
Fisher ordered the insurance companies with which the agency did business to continue paying commissions to the agency but hold any commission payments to Porter-Hart and Pennington until a final determination is made of their license. Money sent to the agency will be used to refund money due the policyholders.
Should money in the agency accounts not be enough to provide full refunds, the insurance companies that Aviation Insurance Group represented will be called upon under state law to fulfill the obligations.
Although an investigation is ongoing as to how much money was stolen from policyholders, officials believe the figure ultimately will exceed $100,000.
Aviation Insurance Group Agency specializes in coverage for small, privately owned airplanes. Although the agency sometimes uses the its initials AIG, it is not related to the New York-based American International Group, which also goes by the initials AIG and owns several insurance companies.
Porter-Hart and Pennington have 30 days in which to appeal Fisher’s order and request a formal hearing in front of hearing officer.