Insurance Agent Committing Fraud

Dallas area insurance lawyers can tell lawsuit stories where they have represented clients who have been ripped of and cheated by insurance agents. The Insurance Journal published a story in October of 2015, that was an article about an agent getting caught stealing from his customers. The title of the article is, Former Southern California Insurance Agent Sentenced For Felony Fraud.
Hesham Saleh Ibrahim, 57, of Palmdale, Calif., pleaded no contest to felony insurance fraud and was sentenced to three years felony probation, 30 days community labor and ordered to pay nearly $1,000 in restitution and fines. Ibrahim was an insurance agent licensed to conduct business in California.
Ibrahim was charged in July 2015 with six misdemeanor counts of transacting insurance without a license for issuing 114 auto insurance policies. He was also charged with one count of felony insurance fraud for issuing a fraudulent insurance certificate for a $2 million commercial liability policy and pocketing the $350 premium.
The California Department of Insurance investigation division began an investigation after receiving a complaint from a consumer claiming they paid Ibrahim for liability insurance for their business, but did not receive a policy.
Department investigators discovered Ibrahim was transacting business on an expired agent license, operating under Five Star Insurance Agency and Convenience Store. The department contacted Ibrahim and communicated that he was transacting business illegally and should stop immediately. He continued to function as an agent, issuing 15 additional auto insurance policies after receiving the warning, according to the department.
“Ibrahim put the business owner at great financial risk when he issued a bogus insurance certificate,” Insurance Commissioner Dave Jones said in a statement. “The consumer did the right thing by reporting they did not receive a policy from the insurance company, which helped our investigators uncover Ibrahim’s illegal business activity.”
This case was prosecuted by the Los Angeles County District Attorney’s office.
In Texas, an insurance company is responsible for many of the acts of its agent. This is addressed in the Texas Insurance Code, Section 4001.051. Sub-section (b) defines some of the acts an agent may take that makes him an agent for the insurance company. They include:
(1) solicits insurance on behalf of the insurer;
(2) receives or transmits other than on the person’s own behalf an application for insurance or an insurance policy;
(3) advertises or otherwise gives notice that the person will receive or transmit an application for insurance or an insurance policy;
(4) receives or transmits an insurance policy of the insurer;
(5) examines or inspects a risk;
(6) receives, collects, or transmits an insurance premium;
(7) makes or forwards a diagram of a building;
(8) takes any other action in the making or consummation of an insurance contract for or with the insurer other than on the person’s own behalf; or (9) examines into, adjusts, or aids in adjusting a loss for or on behalf of the insurer.