Plus, more contractors acting as unlicensed adjusters
The FBI is after the infamous McClenny Moseley law firm for alleged hurricane litigation fraud, an insurance licensing exam scheme is exposed in Miami, Governor DeSantis suspends a councilwoman indicted for insurance fraud, a Palm Harbor man is charged with negotiating roof damage claims without a license, and the Iowa Insurance Division cracks down on unlicensed public adjusters. It’s all in this week’s Fraud Digest.
FBI Investigating McClenny Moseley: Houston, Texas based law firm McClenny Moseley & Associates (MMA) are back in hot water. First, the firm was barred from collecting pending claim fees from Hurricanes Laura and Delta in Louisiana by a federal judge in March of last year following accusations of fraud and unfair trade practices. Now, the FBI has begun a formal investigation, seeking information from potential victims in southeastern Louisiana where thousands of hurricane damage lawsuits have been allegedly mishandled by the firm in the wake of Hurricane Ida. While the FBI continues to build a case on MMA and their purported mishandlings, the company has gone belly up, filing for bankruptcy back in April. Appeals courts in Louisiana have vacated two of the previous rulings – allowing MMA another chance at the blocked claim fees, and allowing a hedge fund, EAJF, to intervene in the proceedings.
Florida Insurance License Exam Scheme: Two licensed Miami insurance agents and a third individual have been arrested and charged for operating an unauthorized insurance agent licensing school and taking exams in place of those enrolled. Rainer Miguel Salas, his son, Rainer Alexander Salas, and receptionist Karla Lit Peralta Ceballos were regularly accepting payments of up to $2,000 through D&R Insurance Group to help insurance licensing test-takers circumvent examination security protocols. According to arrest reports, 820 license exams were flagged as “subverted by an unauthorized computer” by the Pearson VUE administrators. At least five Florida agents enrolled in the school have had their licenses suspended. Each of the accused could face up to 15 years in prison if convicted.
Councilwoman Indicted for Insurance Fraud: Late last month, Governor DeSantis signed Executive Order 24-135, suspending Hialeah City Councilwoman Angelica Pacheco from her position after she was indicted on federal felony charges for Conspiracy to Commit Health Care Fraud and Wire Fraud, and five counts of Health Care Fraud. Pacheco has pleaded not guilty and is intent on returning to office, insisting that her removal was politically motivated in a video posted on YouTube. She is accused of paying kickbacks to patients, incentivizing them to seek services from her addiction treatment clinic. The clinic and affiliated labs then billed multiple insurance companies over $19 million in unnecessary testing and treatments from 2017-2020. Florida Life Recovery and Rehabilitation LLC, run by Pacheco and her family, is accused of pocketing the extra money after providing substandard or misbilled services, and closed back in 2022.
Palm Harbor Roofing Racket: The Florida Department of Financial Services is now investigating Trevor Smith, a Palm Harbor man facing charges in Hillsborough and Manatee counties for unlicensed contracting and exploiting the elderly. WTVT-TV in Tampa reports the 27-year-old was soliciting homeowners in both counties during the State of Emergency after Hurricane Ian, knocking door-to-door and offering free roof inspections. Smith even made calls to insurance companies impersonating the homeowners, claimed roof damage without any inspection, and negotiated with insurance companies without an insurance adjusters license. Apex Roofing and Restoration LLC, who employed Smith as an independent contractor, has agreed to cooperate with law enforcement in the ongoing investigation.
Iowa Insurance Cracks Down: We often hear stories from those in the insurance and disaster recover industries that if the laws are tough enough in one state, then those that are unscrupulous and don’t mind harming consumers simply go to another state. But there are also home-grown bad actors. In our research sweep, we found this Iowa Department of Insurance press release cracking down on contractors acting as unlicensed public adjusters. Three of the four were Iowa companies, the fourth was from Illinois next door. We applaud the Iowa Insurance Division and recognize that every state has people who misbehave and harm policyholders.
LMA Newsletter of 7-8-24
