Florida Insurance Scam Hits Seniors

March 19, 2004

• CIGNA Bows to NY, Agrees to Clean Up Reimbursement Rates • Aetna Agrees to Reimburse Students' Health Insurance Claims • New York Nails Insurance Broker for Scamming Seniors • New York Targets Health Insurers • Travelers Insurance Settles Bid-Rigging Charges • Connecticut Derails Title Insurance Kickback Scheme • MBIA Settles Fraud Charges for $100 Million • Wells Fargo, Acordia Sued for Fraud • New York Charges Fraud in Life Settlement Industry • Title Insurance Fraud on the Upswing • Florida Insurance Scam Hits Seniors • Pennsylvania Recovers Another $9 Million from Summit Life Case --- • More about Insurance ...

Florida officials say hundreds of senior citizens were victimized by an organized scheme that netted more than $2 million in fraudulent insurance sales commissions. Attorney General Charlie Crist said five people were arested and charged with racketeering and multiple counts of insurance fraud, money laundering and grand theft.

Insurance fraud investigators with the Department of Financial Services said licensed insurance agents were recruited to gain the trust of victims between the ages 70 and 94. Promising to save them money on their health insurance, the agents instead "slid" them life insurance applications. The sale of whole life insurance policies can net larger commissions.

"These people preyed on senior citizens who needed help in making ends meet," Florida Chief Financial Officer Tom Gallagher said. "It is unconscionable that these individuals devised such an intricate scheme to take advantage of more than a thousand of our most vulnerable citizens."

When the elderly victims learned they had purchased a whole life policy, investigators said, they were instructed to call one of the alleged ring members. Instead of receiving assistance, they were sent to another agent who maintained the scheme.

"For many of the victims," Gallagher said, "the cycle would repeat itself over and over."

Pioneer Life Insurance Company, one of the insurance companies with whom some agents were appointed, has refunded over $1 million to its customers.

Those arrested were identified as Brian Lee Shechtman, 37, of Hollywood; Dean Allen Shechtman, 36, of Aventura; Brad Howard Shechtman, 33, of Miramar; Camille Martinez Shechtman, 30, of Miramar; and Rosemary O'Rourke Welstead, 61, of Ft. Lauderdale, are Brad and Camille Shechtman were booked into the Marion County Jail. The three others were booked into the Broward County Jail.

Welstead and the Shechtmans, except for Brian Shechtman, have had their insurance agent licenses revoked. Brian Shechtman is prohibited from selling any new policies while his administrative complaint is pending.

Brad Shechtman had his insurance license revoked in 1992 after he pleaded no contest to charges of felony grand theft and financial exploitation of the elderly. He was sentenced to five years' probation.

Camille Martinez Shechtman's license was revoked in 1999 and Dean Allen Shechtman's license was revoked in 2003 for fraudulent sales of life insurance to the elderly. At the time, the two were selling policies for Elder Care Insurance Services, owned by Brian Shechtman. Investigators said they traced more than $1 million dollars in illicit life insurance proceeds to Brian Shechtman's brokerage accounts.

Welstead's license was revoked in September 2003 for fraudulent sales of life insurance to the elderly.

Investigators said that after losing their agent licenses, the group recruited licensed agents, friends and acquaintances, and even paid for tutors and insurance school tuition for recruits who were not already licensed. Some were paid a weekly salary in return for signing the fraudulent life insurance applications.

Three agents recruited into the scheme have already lost their licenses.

The department's Division of Insurance Fraud and Division of Agent and Agency Services, Bureau of Investigations, conducted the investigation jointly. The Attorney General's Office of Statewide Prosecution is prosecuting the charges.

The department offers a reward of up to $25,000 for information leading to an arrest and conviction in complex insurance fraud schemes. Information can be provided anonymously. To report insurance fraud, call 1-800-378-0445.

Back to the top |

Terms of Use Your use of this site constitutes acceptance of the Terms of Use

Advertisements on this site are placed and controlled by outside advertising networks. ConsumerAffairs.com does not evaluate or endorse the products and services advertised. See the FAQ for more information.

Company Response Welcome If complaints about your company appear on our site, we welcome your response. Please see the Response Form for more information.

For more information, see the FAQ and privacy policy. The information on this Web site is general in nature and is not intended as a substitute for competent legal advice.  ConsumerAffairs.com Inc. makes no representation as to the accuracy of the information herein provided and assumes no liability for any damages or loss arising from the use thereof. 

Copyright © 2003-2009 ConsumerAffairs.com Inc.  All Rights Reserved.    The contents of this site may not be republished, reprinted, rewritten or recirculated without written permission.