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Special note for NY insurance brokers and agents

Brokers & agents are required to earn 15 Continuing Education Credits every 2 years in order to maintain their license in NY. Harry P. Mirijanian, President Applied Risk, has developed a new 8 credit course for St. John’s University. This new class, “Risk Control Organizational Impact” will be presented for the first time on September 23, 2010 at St. Johns downtown campus (Murray Street).

If you are interested in attending, contact St. Johns Admission office at 212-277-5161.

Insurance Broker Sentenced To 10 Years In Prison For Grand Theft And Insurance Fraud By Taking $4.6 Million In Premiums

SANTA ANA - An insurance broker pleaded guilty yesterday to a court offer of 10 years in state prison for grand theft and insurance fraud by taking $4.6 million in premiums and issuing false certificates of insurance to four companies. Mitchell Basil Zogob, 51, San Juan Capistrano, pleaded guilty April 5, 2010, to five felony counts of grand theft by embezzlement, five felony counts of insurance fraud, five felony counts of transacting as an insurance business without a certificate of authority, four felony counts of forgery, three felony counts of tax fraud, one felony count of premium fraud, and sentencing enhancement allegations for aggravated white collar crime over $500,000 and the taking of over $2.5 million.

"These types of fraud are especially egregious because it leaves companies who are buying insurance for their workers and their employees unprotected. It hurts legitimately injured workers from receiving the benefit they deserve. Any defendant fraudulently collecting millions of dollars to support their fancy lifestyle deserves to go to prison," said Insurance Commissioner Steve Poizner.

Between January 2002 and April 2004, Zogob worked as an insurance broker and operated two businesses, Professional Employers Assurance Group (PEAG) and Program Administrators, Inc., out of a Newport Beach office on Birch Street. He was a licensed broker for over 20 years but did not renew his license in October 2002.

Between January 2002 and February 2003, the defendant sold workers' compensation insurance policies to MicroSource Management and Joint Employers Group. These companies outsource the management of payroll, workers' compensation, human resources and employee benefits to other companies. Zogob collected the premium from MicroSource Management, who had 60 client companies and 16,000 employees, and issued a forged certificate of insurance. Zogob collected the premium from Joint Employers Group, who had over 75 payroll companies and 3,500 employees, and issued a forged certificate of insurance. The defendant kept the money for himself and spent it on his extravagant lifestyle.

The defendant also sold workers' compensation insurance to two payroll companies, Media Services Inc. and Olympic Partners/C.A.P.S. who provide services to the entertainment industry and covered over 60,000 employees. Zogob fraudulently used AIG/Granite State, Hartford, Regency, and Transglobal Indemnity Ltd., as insurance carriers on the forged certificates. Hartford, although a valid policy, was an extended coverage from a Texas business' personal office insurance policy which the defendant used to issue bogus certificates of insurance. Regency and Transglobal Indemnity Ltd. are alleged off-shore companies whose status could not be verified and are not authorized to write insurance policies in California. Zogob had received insurance from AIG/Granite State for PEAG and fraudulently used that insurance carrier name and certificate number to issue MicroSource Management certificates of insurance.

Between January 2003 and January 2004, Zogob did business with Kellogg & Associates. He sold the company workers' compensation insurance but failed to provide a valid certificate of insurance.

The workers' compensation insurance claims filed by individual employees and paid out by the victimized companies is still under review and the amount is yet to be determined.

From April 2001 to April 2003, Zogob willfully failed to file a tax return and presently owes the Franchise Tax Board over $122,000.

US Labor Department's OSHA proposes $130,800 in fines for Yonkers, NY, woodwork manufacturer for fire, chemical and amputation hazards

TARRYTOWN, N.Y. - The U.S. Department of Labor's Occupational Safety and Health Administration has cited H&H Woodworking Inc., a Yonkers, N.Y., manufacturer of custom architectural woodwork, for 26 alleged willful and serious violations of safety and health standards after an employee sustained a partial hand amputation on an unguarded radial arm saw. The company faces a total of $130,800 in proposed fines.

"Our inspection found that the blades on this and other saws lacked the guarding designed to prevent just this type of accident," said Diana Cortez, OSHA's area director in Tarrytown. "In addition, we identified a range of mechanical, chemical and fire hazards that, if uncorrected, expose employees to the dangers of flash fires, eye injury, hazardous substances and an inability to exit the workplace swiftly in the event of a fire or other emergency."

The unguarded saw blades resulted in OSHA issuing the company two willful citations with $84,000 in proposed fines. OSHA defines a willful violation as one committed with plain indifference to or intentional disregard for employee safety and health.

The inspection also identified potential fire hazards including the accumulation of combustible wood dust; a failure to ground and bond segments of the plant's dust collection system; unbonded containers of flammable liquids; combustible residue accumulation on surfaces of spray booths; and no training in fire extinguisher use. Other hazards included a locked exit door; obstructed exit route; untrained forklift operators; no lockout-tagout program for energy sources; respirator deficiencies; no chemical hazard communication program; allowing workers to consume food in areas where hazardous chemicals are used; a lack of quick drenching facilities for workers exposed to corrosive liquids; and insufficient protective measures for employees working with methylene chloride. These conditions resulted in the issuance of 24 serious citations, with $46,800 in fines. OSHA issues serious citations when death or serious physical harm is likely to result from hazards about which the employer knew or should have known.

"One means of preventing recurring hazards is for employers to establish effective comprehensive workplace safety and health programs that involve their workers in proactively evaluating, identifying and eliminating those hazards," said Robert Kulick, OSHA's regional administrator in New York.

US Labor Department's OSHA fines Lowe's Home Center $110,000 for continual record keeping violations at Cincinnati and Dayton stores

CINCINNATI. - The U.S. Department of Labor's Occupational Safety and Health Administration has cited Lowe's Home Centers Inc. in Cincinnati and Dayton, Ohio, with $110,000 in proposed penalties for continually failing to document and report employee injuries and illnesses.

As a result of an October 2009 inspection in Cincinnati, OSHA issued Lowe's four willful citations with a proposed penalty of $40,000. Based on a November 2009 inspection, OSHA issued the Dayton store seven willful citations with a proposed penalty of $70,000. A willful violation is one committed with intentional, knowing or voluntary disregard for the law's requirement, or plain indifference to employee safety and health.

OSHA requires employers to record and maintain occupational injuries and illnesses on the OSHA 300 log.

"Accurate injury and illness records are vital to protect workers' health and safety," said OSHA Area Director Richard Gilgrist in Cincinnati. "Accurate records are an important tool that employers and workers can use to identify hazards in the workplace, and they also enable OSHA to better target its resources."

The company has 15 business days from receipt of its citations and penalties to comply, request an informal conference with OSHA's area director or contest the findings before the independent Occupational Safety and Health Review Commission.

A Tioga County contractor was arrested Tuesday after investigators discovered that he inflated an insurance claim in connection with damages resulting from a faulty plumbing fixture, the New York State Insurance Department reported.

State police at Owego arrested Joseph Watson, 70, of Owego, after an investigation by the Insurance Department’s Frauds Bureau.

Investigators said Watson filed a $7,800 claim with Chartis Insurance Company after he installed a faucet that proved to be defective and caused water damage to a house he was working on. He later admitted to investigators that the actual damages amounted to just $1,000. Chartis insures the manufacturer of the faucet.

Watson was charged with third degree insurance fraud. A hearing will be scheduled in Town of Owego Court.

A Kingston woman whose former employer noticed her working at a fast food restaurant in the Town of Ulster while she was collecting workers' compensation benefits for an injured back was arrested Wednesday.

Erika Bravo, 35, of St. James Street, is accused of fraudulently accepting $34,900 in benefits over a two-year period. She was arrested after a joint investigation by the New York State Insurance Department's Frauds Bureau and the Town of Ulster Police Department. She is being held without bail pending a May 11 hearing on an unrelated immigration investigation.

Bravo started collecting the benefits after hurting her back while employed as a housekeeper at a senior citizens residence in August 2007. However, she accepted the benefits while continuing to work at what had been her second job at a fast food restaurant.

She testified at a workers' compensation hearing in 2008 that she was no longer working. However, some time after the hearing, her former employer at the senior citizen residence noticed her working in another area fast food restaurant. The employer contacted investigators who discovered that Bravo had gained employment at the restaurant using the name of a distant relative, as well as a fictitious address and Social Security number.

Bravo faces charges of perjury, insurance fraud, identity theft and workers' compensation fraud. She could be sentenced to up to seven years in prison if she is convicted. A hearing will be held in Ulster County Court.

Insurance Commissioner Poizner Announces Street Race Video on YouTube Leads to Arrest of Diamond Bar Siblings for Alleged Auto Fraud

Brother, Sister Submit Claim For Nissan GT-R ‘Supercar’ Accident Found on Video Sharing Site

California Insurance Commissioner Steve Poizner announced today that on Friday, March 5, Jay Xi Chen, 21, and his sister, Tracy Chen Chen, 29, both of Diamond Bar, were arrested at their residence on felony auto insurance fraud charges for filing an allegedly false insurance claim surrounding damage done to a Nissan GT-R supercar. Jay was charged with six counts; Tracy was charged with one.

"We are all victims of auto insurance fraud by paying for our fellow consumers' false claims," said Commissioner Poizner. "This case also highlights the diligence and creativity with which we will pursue allegedly fraudulent claims."

A four-month investigation revealed that Jay reported to Farmers Insurance Exchange that his sister had been driving the GT-R when it was involved in a collision on Interstate 10 on March 16, 2009. Tracy corroborated this story. Jay later withdrew this claim, stating he would pay for the repairs himself.

On June 2, 2009, Jay reported another claim with the same vehicle, stating that this time he crashed the auto while driving on Highway 60 in Riverside County.

However, ICC Collision Center reported that it had Jay's unrepaired Nissan GT-R in its shop since March 2009.

Furthermore, a video found on YouTube (http://www.youtube.com/watch?v=MXKUd8oCKSQ) showed a Nissan GT-R being driven on Glendora Mountain Road during what appears to be a street race. The supercar crashed into a wall. Detailed inspection of the video showed the GT-R has the same damage as the one in Jay's claim. The potential loss of this claim was $76,000.

The criminal charges were filed against the Chens by the San Bernardino County District Attorney's Office, which is prosecuting the case. Each count could result in a penalty of up to five years in prison and/or $10,000 in fines if convicted.

*Special note for NY insurance brokers and agents*

Special note for NY insurance brokers and agents