Authorities Warn of Insurance Scam

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The U.S. Attorney’s office in Phoenix is warning trucking companies and owner-operators to check the validity of their insurance after the indictment of four people for embezzling more than $1.5 million in premiums.

Terry B. Lamb, Laura A. Palacios and Darin B. Tarwater, all Arizona residents, and Nelly Herrera of Toronto, Canada, were charged with mail and wire fraud in a 37-count federal indictment.

n investigation into their operation was prompted by complaints that the Florida’s Department of Insurance had received from policyholders.

U.S. Attorney Jose de Jesus Rivera said the defendants sold liability, comprehensive and collision, cargo and trailer insurance policies to carriers and owner-operators between 1996 and 1998. Instead of covering the policy, the four pocketed the premiums for their personal use.

When a customer bought insurance, they received a variety of false applications, insurance policies and other documents, Rivera said. Some customers were asked to mail their monthly or annual premiums to post office boxes in Phoenix or Chandler, Ariz. Others were asked to mail payments to an international mail forwarding service in Miami, Fla., which routed the checks to Chandler.

Most customers did not receive payments when they filed claims, Rivera said. Others received only partial payment.

The defendants claimed to work for the following nonexistent agents and brokers:

ACC Management.

LI> ABC Insurance.

LI> Transportation Management.

LI> Writers Direct Inc.

LI> Commagre Insurance.

LI> AVV Insurance.

Claims that policies brokered by Writers Direct were issued by Commercial Casualty Insurance Co. in California and Georgia were false, since neither company offers motor carrier insurance, Rivera said in the indictment.

Writers Direct and ACC Management also claimed to be brokers for American Casualty Co. of Reading, Pa., Rivera said.

“In many instances, when a trucker has been involved in an accident, they have discovered they are not properly insured or the claim is not paid,” said Cathy Colbert, a spokeswoman for the U. S. Attorney’s office.

“We’ve got a double victimization here,” she said. “The trucker, who thought he was insured, and the accident victim.”