Fraud Roundup

Utah agent charged with pocketing premiums

Ryan Webb, a Salt Lake County, Utah, insurance agent, was charged with insurance fraud, a second degree felony, unlawful dealing by a fiduciary, a second degree felony, theft by deception, a second degree felony, and forgery, a third degree felony.

Webb, an agent with Brighton Insurance Group Inc. of Sandy, Utah, allegedly sold a business insurance policy to the owner of Pinky’s Bar. After a fire loss, the victim filed a claim with Auto-Owners Insurance, but was informed that he had no policy.

According to the Utah Insurance Department, Webb had prepared and provided forged insurance binders to the victim purporting they were the authorized and legitimate policies. He regularly picked up premium checks from the victim and had asked that the checks be written directly to him “for convenience at the bank,” the Department said. Webb allegedly collected more than $20,000 in premium checks that were never forwarded to the insurance company, the department noted.

Man pleads not guilty to charges of swindling Korean-American

A man has pleaded not guilty to charges of swindling 11 Korean-American investors out of nearly $2 million.

Robin K. Cho, 47, faces 118 counts of securities fraud, grand theft and forgery. Prosecutors claim Cho, who ran a company called Citi Travelers Insurance Management, scammed investors through a pyramid scheme between 1998 and 2003.

Cho, of Los Angeles, promised investors 4 to 6 percent interest monthly and said the investments would be low-risk when they were actually risky, eventually losing the investors’ money, California Deputy District Attorney Richard Lowenstein said.

To maintain interest payments to the early investors, Cho continued to sell securities to new investors, Lowenstein said.

When the investors didn’t receive promised payments, Cho blamed the Sept. 11, 2001, terrorist attacks for his failure to pay and made other excuses, prosecutors allege.

He faces a maximum sentence of almost 62 years in prison if convicted, according to Lowenstein. Cho was held on $1.9 million bail and was scheduled to be back in court on July 14.

c:Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Colorado seizes $5 million in
collateral from bail bond agent

Colorado regulators said they had seized about $5 million in loan documents and other collateral from a bail bond agent, saying some of it may have been improperly kept from the people who posted it.

The state Division of Insurance said agents took the records on July 12 from Amor Angel Portugal, also known as Amor Angel Trujillo, and from Heavenly Bail Bonds.

Portugal’s bail bond license was suspended in December after the Department received complaints from consumers about collateral they pledged to guarantee bail bonds, the division said in a press release.

Portugal had no listed phone number. The number for Heavenly Bail Bonds had been disconnected.

The Division of Insurance statement said their agents seized the collateral after learning it had been purchased by a company that lacked a required license. The Division then issued an emergency order blocking the sale.

Insurance regulators said they are working with Colorado’s police and sheriff’s departments, the attorney general’s office and the insurance companies that underwrote some of the baibonds to help return the collateral to its rightful owners.

c:Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

French executive pleads guilty in Executive Life case

A former managing director of a subsidiary of Credit Lyonnais plead guilty to four felony counts of causing the bank to make false statements to the Federal Reserve Bank.

Jean-Francois Henin, 62, of Paris, entered his plea in federal court where U.S. District Judge Dickran Tevrizian sentenced him to five years probation and ordered him to pay a $1 million fine. Henin also will be banned from entering the United States for five years.

The charges against Henin are part of a larger criminal and regulatory investigation involving the takeover of failed insurer Executive Life, which was declared insolvent and seized by the California Department of Insurance in 1991. Executive Life collapsed after its portfolio of junk bonds — some 60 percent of its assets — lost much of its value.

The junk bonds were sold for $3.25 billion to an investor group led by Henin, head of Altus Finance SA, a subsidiary of Credit Lyonnais. The portfolio of policies was then sold to French insurer MAAF Assurances SA.

The investors ended up collecting billions of dollars from the junk bonds when the market picked up.

California later sued and settled with several defendants in the case, including Credit Lyonnais and Aurora National Life Assurance Co, for more than $600 million.

A federal grand jury in Los Angeles indicted six French executive in 2003, including Henin, on various criminal charges for their role in a conspiracy to illegally acquire the assets of the bankrupt Executive Life.

Former Credit Lyonnais Chairman Jean Peyrelevade pleaded guilty earlier this year to charges involving false statements to the Federal Reserve. Others who have struck plea deals include Jean-Claude Seys, who headed the MAAF Assurances SA, and former Altus Chairman Dominique Bazy.

c:Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Topics California Colorado