Local Insurance Agent Charged with Elder Abuse and Fraud
Insurance companies and their agents have a legal and moral obligation to process claims and handle their clients’ policies in good faith. Insurance companies are businesses that exist to make money, so some insurance claims adjusters make every effort to deny policyholders’ claims, or make unfairly low offers.
While claims adjusters may defraud clients when they attempt to make claims on their policies, some agents defraud their clients as soon as they purchase their policies. Unfortunately, some insurance agents use their positions to target the most vulnerable members of society in unethical and illegal ways.
Heffernan’s Scheme
Recently, police arrested a Mission Valley insurance agent, by the name of Shawn Heffernan, for defrauding five elderly clients out of more than $1 million. Most insurance agents earn commissions for the policies they convince clients to purchase. While commission pay structures exist to incentivize good business and to encourage employees to work hard, some view commissions as a means to take advantage of others. Shawn Heffernan not only did exactly this, but investigators suspect he also convinced clients to invest in nonexistent ventures, and he would simply pocket their money and disappear.
Heffernan’s scheme began by convincing elderly clients to purchase annuity policies. Later, Heffernan would contact these clients and convince them to change these annuity policies to different policies. The customers then had to pay substantial fees for canceling their original policies while Heffernan collected large commission bonuses. District Attorney’s Office investigators reported that one client had paid nearly $5,000 in client fees while Heffernan earned more than $250,000 in commissions.
The District Attorney’s Office suspects that Heffernan also directly defrauded investors by convincing them to deposit money into fictional business ventures. He simply took their money, and whenever a client wanted to withdraw money from an account Heffernan would simply use another client’s money to pay. Investigators suspect this method is part of how he was able to collect more than $1 million of clients’ money. He used this money for personal expenses and lavish purchases, including several rental properties and a Maserati sports car.
Legal Repercussions
Heffernan faces five charges of grand theft, and three counts of felony-level elder fraud. Elder fraud has a special designation due to the heinous nature of crimes designed to exploit elderly individuals, and carries a harsher punishment. If a jury finds Heffernan guilty on all counts he faces 14 years and four months in prison. The California Department of Insurance and the District Attorney’s Office continue to investigate Heffernan’s crimes and encourage anyone else with information to contact them as soon as possible.
Elder abuse takes many forms, and unfortunately cases like this may go unnoticed for a long time. Anyone who encounters issues with insurance companies should seek legal representation as soon as possible. Financial elder abuse, if left unchecked, can completely ruin an elderly individual’s finances during retirement and make late-life care more challenging.
Our San Diego personal injury attorneys can help victims of financial elder abuse recover their losses and hold the responsible parties accountable.