Any insurance lawyer who handles many cases will see situations where the insurance agent is simply a criminal. The Insurance Journal has published two stories where an agent has been convicted for his actions.
The first one is from June 2016 and is titled, Texas Insurance Agent Arrested In Scam Targeting Elderly Clients. The story tells us about a Lubbock based insurance agent being arrested and charged with defrauding elderly victims through an annuity scam.
The Texas Department of Insurance reported that Joseph Allen Gaines was arrested last month on charges that he kept clients’ money that was intended to be used to purchase annuities.
Investigators with the Texas Department of Insurance (TDI) and the Lubbock Police Department are trying to determine if there are additional victims.
TDI investigators say it appears most of Gaines victims were over the age of 65, seeking investments for retirement. Gaines would sell them what he claimed were annuities, but never passed their money on to the insurance company to purchase the policies. Instead, he kept their money for himself, according to TDI.
Gaines came to the attention of TDI and the Lubbock Police Department earlier this year, when a 94-year-old woman’s family called the insurance company to confirm her $700,000 investment. They were told there was no policy in their mother’s name.
TDI Sergeant Steve Richardson says it’s important for trusted family members to be involved when it comes to important financial decisions.
“We believe that Mr. Gaines had been a financial advisor for this woman’s family for decades,” Richardson said. “He took advantage of her trust and encouraged her to invest in a fraudulent annuity. We hate to see something like this happen, but when it does we need to act quickly to minimize the damage.”
Investigators are urging anyone who purchased annuities to call their insurance company – and not the agents who sold the policies – to verify that they do have a policy and that the amounts match what they were promised.
The other story is titled, Former Texas Agent Gets Life Sentence For Insurance Scam. The article tells us that that the same agent mentioned in the previous story has been sentenced to life in prison and ordered to pay back $810,000 to his victims.
Officers with the TDI Fraud Unit found that Gaines persuaded senior citizens in West Texas to purchase annuities, but the kept the money for himself.
When Gaines was arrested in July 2016, TDI Sergeant Steve Richardson said Gaines “had been a financial advisor for this woman’s family for decades” and took advantage of her trust.
Other victims were identified and Gaines was charged with felonies in Swisher, Wilbarger, and Howard Counties. Several of Gaines victims testified at the sentencing in Swisher County.
Whenever a person senses that an insurance agent is committing a wrong, they should do two things. Contact the TDI and contact an experienced Insurance Law Attorney.