Ohio Family Charged in $2.9 Million Life Insurance Fraud Scheme
August 15, 2017 by Best's News Service
COLUMBUS, Ohio – A federal grand jury has indicted three members of an Ohio family for participating in a $2.9 million life insurance fraud scheme, alleging they bought policies for a sick relative but hid that condition from the insurers, prosecutors said.
A federal indictment charged Mitch G. Stevenson; his wife Patricia Stevenson; and their 30-year-old daughter, Candace Stevenson, with conspiracy to launder money and money laundering, said Benjamin Glassman, U. S. Attorney for the Southern District of Ohio.
In 2009, two life-insurance policies were fraudulently purchased insuring another, unnamed relative for a combined $2.9 million, the indictment alleged. The policy applications falsely stated that the relative had never been diagnosed with diabetes, high blood pressure or ulcers and that the relative had not had any medication in the 12 months before the application was prepared, prosecutors said.
The defendants reported the person’s weight as 170 pounds, when in actuality the person’s true weight was approximately 375 to 400 pounds, prosecutors said. Prosecutors also alleged the defendants faked the required medical examination.
“In early February 2009, an unknown individual in Sugar Land, Texas, who met the description in the applications, represented herself as the relative at the examination and was weighed at 176 pounds,” Glassman said. “Three weeks earlier, the actual relative was weighed in a Cincinnati emergency room at 387 pounds.”
In early 2011, the beneficiaries were changed to Patricia and Candace Stevenson. In 2012, the relative died, and West Coast Life Insurance Co. issued a $1.5 million check to Patricia Stevenson and a $1.4 million check to Candace Stevenson.
Subsequently, the defendants allegedly engaged in a complex series of transactions designed to conceal the nature of their actions, prosecutors said.
They also purchased a 2012 Bentley GT Convertible for approximately $247,000 and used approximately $284,000 as a property down payment, prosecutors said. Other transactions included approximately $16,000 to World of Decor and nearly $33,000 to Facet Jewelry, prosecutors said.
About two years ago, federal prosecutors convicted a northern Ohio cardiologist on health care fraud charges and sent him to prison for 20 years for illegally billing Medicare and insurance companies for millions of dollars (Best’s News Service, Dec. 21, 2015).
(By Frank Klimko, Washington correspondent, BestWeek: Frank.Klimko@ambest.com)
