Louisiana Court Orders Injunction Against Insurance Fraud Ring

A Louisiana court has ordered a permanent injunction against members of an insurance fraud ring, banning them from further involvement in the insurance business in that state. Louisiana Insurance Commissioner Jim Donelon says the Nineteenth Judicial District Court of Louisiana granted a summary judgment in favor of the Louisiana Department of Insurance, Great Southern Dredging Inc. and Entek Mechanical Corp. and against defendants United Assurance Company Ltd., AA Communications Inc., and James Zoucha, Cong Li and Gwen Moyo in a case involving bogus construction bonds.

In addition to the permanent injunction, the defendants were ordered to return $365,555 to Great Southern Dredging Inc.; make restitution to Entek Mechanical in the amount of $187,018.35; pay $19,293.30 in premium taxes and penalties due on premiums received from Great Southern Dredging; put up a $50,000 court bond; pay LDI’s attorneys’ fees of $120,577.40; pay fines and penalties of $50,000; and pay all court costs and judicial interest.

Moyo was convicted in October 2008 on 41 counts of fraud, conspiracy and money laundering for selling bogus construction bonds and pocketing some $2 million in the process. Sentenced to 20 years in prison, she was ordered to pay restitution of $2.4 million to three of her victims, including a West Memphis, Ark., church. Moyo also was convicted in Arizona in 1989 on similar charges.

Zoucha, of Oceanside, Calif., pled guilty in May 2009 to charges stemming from the money laundering case against Moyo. He was ordered at that time to pay about $321,000 in restitution.

Former Louisiana Sen. Derrick Shepherd pled guilty in 2009 to a charge of conspiracy to launder money from Moyo’s sale of bogus construction bonds.

“Our intent was to prevent those involved with this insurance fraud ring from harming others in Louisiana. Crime like insurance fraud does not pay,” Donelon said.

Topics Fraud Louisiana