COLUMBUS — Lieutenant Governor and Department of Insurance Director Mary Taylor announced the Department’s top fraud and enforcement cases for 2013. During the calendar year, the Department processed 6,349 allegations of agent misconduct and insurance fraud, initiated 1,633 investigations, identified more than 519 civil and criminal violations of Ohio insurance law, took administrative action against 169 insurance agents and agencies, assessed $43,800 in fines and referred 63 individuals for prosecution.
“We continue to aggressively fight insurance fraud on behalf of those directly harmed in these cases,” Taylor said. “Insurance fraud is a serious crime that drives up the cost of insurance for all Ohioans and in order to bring offenders to justice we continue to work with our law enforcement partners at the local, state and federal level.”
Taylor said Ohioans, prior to buying insurance products from an insurance agent or agency, should contact the Department at 1-800-686-1526 to ensure they are properly licensed. Consumers are also encouraged to call 1-800-686-1527 if they feel they have been deceived or suspect someone has committed insurance fraud. Information about insurance and how to prevent and report insurance fraud and professional misconduct is available at www.insurance.ohio.gov.
The Department’s top statewide fraud and enforcement cases for 2013:
Coshocton Woman Sentenced for $2.1 Million Health Care Fraud Scheme
In December, Barbara Elise Miller, former owner of Three Rivers Infusion and Pharmacy Specialists in Coshocton, was sentenced in U.S. District Court in Akron. She was ordered to serve 54 months in prison and three years of probation for submitting fraudulent healthcare billings to private insurance companies and Medicaid. In July, she was sentenced in U.S. District Court in Akron to serve 27 months for obstructing the federal health care fraud investigation.
Coshocton Duo Associated With Health Care Fraud Scheme Sentenced
In October, Doug Bolden and James Ireland, of Coshocton, were sentenced in U.S. District Court in Akron for their earlier involvements in the federal obstruction case regarding Three Rivers Infusion and Pharmacy Specialists’ health care billing scheme. Bolden was given two months in prison, six months of home detention and three years of probation. He was ordered to pay a $131,043.75 fine. Ireland was sentenced to two months in prison, six months of home detention and one year of probation. He was also ordered to pay a fine of $16,933.63.
Two Former Lorain County Title Agents Sentenced for $290,000 Title Insurance Fraud
In December, Gregory R. Klima, of Avon Lake and the co-owner of Title Access, LLC, was sentenced in the Lorain County Court of Common Pleas and ordered to serve 18 months in prison and three years of probation for his role in diverting $290,484.00 from an escrow account for personal use. His business partner Timothy R. Grodzik, of Columbia Station, was sentenced in November to 15 months in prison and three years of probation. They were ordered to pay full restitution.
Miami County Resident Sentenced for Fraud Involving $60,000 Insurance Claim
In August, a Miami County Common Pleas Judge ordered Patricia Young, of Piqua, to serve three years of community control. Young filed false information to support an alleged fire loss totaling more than $60,000. If Young fails to abide by the terms of her sentence, she will serve 17 months in prison.
Boardman Chiropractor Sentenced for $33,000 Attempted Insurance Fraud
In March, chiropractor David Esarco, of Boardman, was sentenced in the Mahoning County Court of Common Pleas and ordered to serve two years of community control, 60 days of house arrest and pay a $1,000 fine after being convicted of attempted insurance fraud and attempted theft. Full restitution was paid to the insurance carriers who Esarco defrauded. He billed insurance companies more than $33,000 for services he never rendered to patients. He pled guilty to workers’ compensation fraud for a similar billing scheme.
Fake Health Insurance Entity Issued Permanent Cease and Desist Order
In October, the Department issued a final order to United States Contractors Trust making the previous order to cease and desist permanent. The entity sold fictitious health insurance coverage to at least four Ohioans. The entity is not licensed to sell insurance in Ohio and has also been ordered to stop its unauthorized insurance business in South Carolina, North Carolina, Vermont, Florida and Maine.
Reynoldsburg Agent Loses License after $149,000 Theft and Forgery Conviction
In July, the Department revoked the license of Lee Solomon, of Reynoldsburg. Solomon, who served as President of SOLO-NFO, misappropriated premiums collected from clients, failed to place insurance coverage as directed by their clients, and forged client signatures on annuity surrender forms in a $149,000 case. In addition to losing his insurance license, Solomon was convicted in criminal court of theft, forgery, identity theft and perjury.
Berea Agent Loses License for $117,000 Annuity Misrepresentations
In December, the Department revoked the insurance license of Margie T. Karl, of Berea, after it was found she misrepresented the terms and conditions of three annuity products sold causing the consumers to incur more than $117,000 in surrender fees.
Worthington Agent Submits Bogus Applications to Generate $3,300 in Commissions
In June, the Department revoked the insurance agent license of Josh Bialka, of Worthington, after an Enforcement investigation confirmed he submitted at least 27 fictitious insurance applications to insurer AFLAC for 13 individuals that do not exist. He had received $3,350 in advanced commission that the insurer was able to recover.
Cuyahoga Falls Agent’s License Revoked for Life Insurance Forgery
In August, the Department revoked the insurance license of Bradley D. Ward, of Cuyahoga Falls, for forging a consumer’s signature and submitting an application for a life insurance policy to an insurance company without the consumer’s knowledge or permission.
The Ohio Department of Insurance fraud unit investigates allegations of insurance fraud, such as the submission of false or inflated claims, and works with prosecutors to criminally prosecute those who commit fraud. The enforcement unit investigates allegations of unlicensed insurance activity as well as agent / agency misconduct.
You can follow the Department on twitter @OHInsurance and on Facebook at www.facebook.com/OhioDepartmentofInsurance.