Investigation Unveils Fraudulent Practices of Public Adjusters and Insurance Agents

The Bureau of Investigation has launched a significant case targeting a public adjuster after receiving a referral from an insurance provider. This investigation stems from allegations that the public adjuster unlawfully retained claim proceeds checks meant for numerous policyholders. The insurer's special investigation service initiated the referral, leading to an extensive probe involving affidavits from numerous victims and detailed reviews of records from both the insurance company and financial institutions.

One notable victim, an elderly woman, flagged a discrepancy of over $117,000 owed by the public adjuster. Despite repeated attempts to contact the adjuster, she received no response, prompting further investigation. As the inquiry progressed, nine additional affidavits emerged from victims facing similar issues of unreceived claim payments. Bank statements exposed the adjuster's luxurious lifestyle funded by these embezzled claims, revealing frequent casino visits while policyholders were left without their entitled funds.

Subsequently, the Bureau of Investigations forwarded its findings to the Criminal Investigations Division. On July 23, 2024, the public adjuster was formally charged with the felony of Financial Exploitation of an Elderly Person or Disabled Adult, resulting in the indefinite suspension of their license. Additional charges of organized fraud and the mishandling of funds were filed in March 2026, with the adjuster now waiting for trial.

In another alarming incident, the Bureau of Investigation scrutinized a life, health, and variable annuity agent following allegations from the Division of Consumer Services. The investigation uncovered that the agent had processed applications through the Federally Facilitated Marketplace without obtaining consumer consent. Evidence was gathered from victimized consumers, insurance providers, and the Center for Medicare & Medicaid Services (CMS).

The unauthorized enrollments surfaced when consumers were notified by the Federally Facilitated Marketplace. It was discovered that the agent falsified income information to qualify policyholders for federal premium tax credits. This deceit led consumers to confront unforeseen tax liabilities due to inaccurate income reporting, which complicated tax refunds and resolution efforts. Consequently, the agent was fined $3,500 and placed on probation.

A further investigation resulted from a compliance review by the Financial Industry Regulatory Authority (FINRA) against another life, health, and variable annuity agent. FINRA concluded that the agent failed to cooperate with investigations, leading to their barring from association with FINRA member firms. Additionally, the agent's non-compliance with departmental inquiries and refusal to partake in interviews resulted in the revocation of their license.

In a separate case, an insured individual submitted a complaint alleging that a general lines agent had been collecting premiums for homeowners' insurance over three years without actually securing the coverage, leaving the home at risk. The investigation revealed that the agent issued fraudulent insurance certificates. Another consumer also reported premium misappropriation, unaware of policy cancellation due to partial premium submissions. The agent's licenses were subsequently suspended for two years because of these violations.