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New York, NY (CompNewsNetwork) - Seventy-five insurance agents, brokers and other producers can no longer sell insurance in New York. Their insurance licenses were revoked or surrendered during the first six months of 2008 because they violated State Insurance Law or regulations, Insurance Superintendent Eric Dinallo announced today. An insurance license is necessary to legally transact any insurance business in the State.
In addition, 225 producers, including agents, brokers, adjusters and service contract providers were fined more than $530,000 in the same period after they admitted or were found guilty after an administrative hearing of various violations of the State Insurance Law or regulations.
"Protecting New York consumers is of prime importance to the Insurance Department," Dinallo said. "Insurance is based on trust – trust that you're getting the right product at the right price, trust that the money you give an agent or broker will go to pay your premiums, trust that if anything happens, you will be covered. We will continue to aggressively pursue those who violate that trust and make sure consumers receive the full protection of the Insurance Law."
License revocation, the Department's strongest sanction, is used to protect consumers against the most serious violations of the Insurance Law. Among those whose licenses were revoked or who signed an agreement with the Department agreeing to give up their licenses with the full force and effect of a revocation, and the reasons for the actions, are:
- US Group Medical Administrators, Frank Winston, Tarrytown: Collected more than $900,000 in premiums that was not remitted to the insurance companies or accounted for;
- James Gard, Lake Peekskill: Collected premium money from an applicant for life insurance and never remitted the premium. He led the clients to believe they had life insurance for over a year, when, in fact, they did not. He also collected $35,000 from the same clients, did not invest it as directed and kept the money in his own account for more than two years;
- Kevin James Dunn, Jr., Staten Island: Forged a client's signature to fraudulently obtain $100,000. He failed to cooperate with the Department's investigation and did not notify the Department of his new business address;
- Philip Nociforo, Sound Beach: Violated regulations designed to inform consumers of the cost of replacing life insurance policies. He also had a felony conviction for grand larceny, misappropriated $50,559 in insurance premiums and failed to respond to the Department;
- Fox Brokerage, Inc., and Michael B. Fox, Brooklyn: Admitted to commingling premium and operating expense accounts and issuing 137 premium checks totaling $84,552.69 that were dishonored by the bank. He failed to notify the Department within 30 days that he was arrested in Kings County;
- Michael Trummer, Salamanca: Submitted 33 applications for insurance that were neither requested nor authorized by the proposed insureds. He also failed to cooperate with the Department Michael Trummer, Salamanca: Submitted 33 applications for insurance that were neither requested nor authorized by the proposed insureds. He also failed to cooperate with the Department''s investigation; and
- Robert Regina, West Islip: Stole money from 11 of his clients. He attempted to cover up the thefts by making unauthorized charges to the credit cards of other clients. He was terminated for cause from Allstate for attempting to cheat them out of overtime money.
The fines resulted from various violations of the Insurance Law and regulations, including:
- Allowing unlicensed individuals to work as independent adjusters. Independent adjusters handle claims for insurance companies. Licensing ensures they are knowledgeable and fair;
- Replacing annuities without proper disclosure. Consumers buy annuities in order to get a guaranteed income for life or a fixed period. They may not be aware of the hidden costs of replacing an annuity and other factors that should be considered when replacing an annuity. Insurance Law requires various disclosures so consumers can be fully informed when making this important decision;
- Acting as a service contract provider without obtaining an approval of registration. Service contract providers must register with the Department in order to assure the faithful performance of their obligations;
- Hampering and impeding the Department Hampering and impeding the Department's investigation;
- Issuing dishonored checks and commingling funds in a fiduciary account;
- Failing to report administrative actions taken against the licensee by another jurisdiction or governmental agency; and
- Charging service fees without a proper agreement.
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