Insurance agent busted for massive fraud committed in Orange County

ORANGE COUNTY DISTRICT ATTORNEY PRESS RELEASE

Case # 14CF1518

Date: March 6, 2015

FORMER INSURANCE AGENT SENTENCED TO SEVEN YEARS IN STATE PRISON FOR RECEIVING OVER $900,000 COMMISSION AND PREMIUM PAYMENTS FROM FRAUDULENT INSURANCE POLICIES

SANTA ANA – A former insurance agent was convicted and sentenced today to seven years in state prison for receiving over $900,000 in commission and premium payments from fraudulent insurance policies. Jacob Richard Bonzer, 28, Chicago, Ill. pleaded guilty today to 49 felony counts of grand theft, one felony count of forging a false Department of Insurance report of examination, one felony count of transacting insurance business without certificate of authority, 45 felony counts of insurance fraud, with sentencing enhancements for aggravated white collar crime over $500,000, and a taking over $200,000. He was also ordered to pay $918,302 restitution to the victims.

Circumstances of the Case

Between 2009 and 2013, Bonzer committed three separate crimes. A joint investigation was conducted by the Brea Police Department, California Department of Insurance (CDI) and the Orange County District Attorney’s Office.

Farmers Insurance Group Insurance Fraud #1

On Aug. 4, 2009, Bonzer obtained his insurance license and was hired the next day by Farmers Insurance Group (FIG) as a reserve agent at a FIG branch in Brea. On July 31, 2010, Bonzer was terminated from FIG for failing their career program.

After Bonzer’s termination, FIG opened an investigation and found 128 homeowner’s policies which listed their mailing address as Bonzer’s office. No premium was ever collected by FIG on any of these 128 policies. The policies were validly issued but the named of those insured did not own the properties thereby making the policies fraudulent.

Bonzer was paid and received commission from FIG for $46,000 for all 128 fraudulent policies. Bonzer never returned his commissions on these policies. On Nov. 17, 2010, CDI received notice of Bonzer’s termination from FIG and began investigating this case.

Farmers Insurance Group Insurance Fraud #2

In September 2011, CDI received information that a citizen’s name appeared on a FIG Memorandum of Fire Insurance for a property this citizen was never associated with. The FIG policy showed that it involved another FIG Agent.

Bonzer had created a fictitious company by the name of CBG and Company. Bonzer approached the Agent and represented to the Agent that he had a good relationship with CBG and Company, which processes mortgages. Bonzer claimed to have received the names of the homeowner’s involved in short sales from CBG and Company. Bonzer provided these names to the Agent which resulted in 791 policies being bound.

None of the people in the 791 insurance policies owned the properties Bonzer listed, making them fraudulent. The Agent received full commission in the amount of $573,242 which was split with Bonzer on these properties even though no premium was paid to FIG for these fraudulent policies.

The FIG Agent repaid to Farmers Insurance Company his commission chargebacks of $333,489. Bonzer never returned his commissions on these policies.

GW Mutual Risk Retention Group Premium Insurance Fraud

In 2012, Bonzer created a fictitious insurance company by the name of GW Mutual Risk Retention Group, LLC (GW Mutual) which he registered in Florida. GW Mutual is not licensed by California to write insurance, nor to transaction business within the State of California. The defendant sold workers’ compensation and commercial insurance policies through his agency, Bonzer Insurance Brokerage, located in south Orange County.

Bonzer defrauded his customers using multiple P.O. boxes, virtual assistants, business entities, office spaces, e-mail accounts, website domains, and bank accounts. Bonzer collected over $632,000 in premium from California consumers, who believed they were purchasing valid coverage.

Bonzer was questioned by a customer about GW Mutual’s ability to transact insurance in California. He provided the customer a fraudulent CDI Report of Examination as proof. The lack of coverage with a licensed insurance company places these businesses in a position of lifetime exposure to potential financial loss.

Bonzer spent the money he received from premium payments on personal living expenses, including renting luxury high-rise apartments, travel, wine clubs and fine dining.

Deputy District Attorney Debbie Jackson of the Insurance Fraud Unit prosecuted this case.

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TONY RACKAUCKAS, District Attorney

Susan Kang Schroeder, Chief of Staff
Office: 714-347-8408
Cell: 714-292-2718