LOS ANGELES (CNS) – Three people were arrested today on federal charges alleging they were operating a scheme to defraud insurance finance companies.
Taken into custody at their homes were Lee Anthony Corlette, 64, of Redondo Beach; Sherman Franklin Hulsey, 60, of Santa Barbara, and Jane Graves, 61, of Astoria, Ore. They were scheduled to make court appearances this afternoon.
A federal grand jury in Los Angeles returned an indictment against the trio on Sept. 5, said Bruce Riordan of the United States Attorney’s Office.
Corlette was charged with seven counts of mail fraud, nine counts of wire fraud and 16 counts of aiding and abetting in connection with a scheme to submit numerous fraudulent insurance premiums to insurance finances companies.
Hulsey and Graves were charged with one count of mail fraud each, three counts of wire fraud and four counts of aiding and abetting.
“Insurance fraud is not a victimless crime,” said United States Attorney Andre Birotte Jr. “The allegations in this case describe a wide- ranging fraud scheme and my office is working with our partners at the federal, state and local levels of law enforcement to protect consumers and remedy serious fraud like that alleged here.”
Birotte said his office works closely with the FBI in investigating alleged fraud cases involving the insurance industry.
The indictment alleges that Corlette, while CEO of Insurance Works Inc., and doing business as Star Alliance Insurance Services in Long Beach, obtained more than $4 million in fraudulent loans from the finance companies who believed the money would be provided to the carriers identified in the agreements submitted by Corlette.
The other two defendants were alleged to have assisted Corlette by providing information about their businesses so she could submit the agreements and fraudulently obtain the loans.
Hulsey owned Liberty Paradise LLC in Santa Barbara and Global Consulting Services, doing business as Vanguard Benefits. Graves was secretary/treasurer of Global Consulting and owner of Steward Holdings LLC in Astoria.
Earlier in the year, a former bookkeeper was charged in connections with the scheme and is awaiting sentencing. The defendants face a statutory maximum penalty of 20 years in federal prison for each count of mail fraud and wire fraud.
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