Insurance agent charged with scamming seniors in alleged STOLI scheme

Florida authorities yesterday arrested insurance agent Steven M. Brasner on charges that he falsified information on elderly clients’ life insurance applications to sell the applications on the secondary market.
Mr. Brasner, an agent with Infinity Financial Group LLC in Davie, Fla., has been slapped with 22 counts of grand theft, insurance fraud and aggravated white collar crime.
Axa Equitable Life Insurance Co., which sued Mr. Brasner in 2008 in connection with this case, had notified Florida’s state regulators of the suspicious policies. The civil case is still being litigated.
Axa notified the regulators in adherence to state rules that require carriers to report suspected fraud activity, said the insurer’s spokesman Michael Arcaro. “We have a longstanding policy of not knowingly selling a life insurance policy to anyone whose reason for buying it is to sell it to an investor,” he said. The insurer has since rescinded all of the policies.
Officials in Florida, including the state finance chief and attorney general, charged that Mr. Brasner created a scheme to sell policies taken out on the lives of senior citizens on the secondary market, then identified his victims and scammed them into buying a policy. As part of the scheme, he falsified the clients’ net worth.
Though it’s legal to sell policies over the secondary market, purchasing insurance with the express purpose of selling it violates state insurable interest laws.
Axa said it had documented five instances in which Mr. Brasner filled life insurance applications for senior citizens and submitted them, accompanied by certifications indicating that the policies wouldn’t be sold or transferred on the secondary market.
The agent made more than $1.6 million in commissions on the policies, based on some $78 million in total death benefits, according to regulators.
State officials also claim that Mr. Brasner told the senior clients that he would pay them between 3% to 5% of the face value of the life insurance policies following the two-year contestability period when the contracts were sold over the secondary market. He also allegedly told the elderly Axa clients that they wouldn’t have to pay for the premiums out of pocket.
Regulators say their investigation also turned up another $6.5 million life insurance policy that Mr. Brasner wrote for another elderly client. The agent certification accompanying the policy, which was placed with Transamerica Occidental Life Insurance Co., also had misrepresentations, according to the regulators.
A call to the attorney representing Mr. Brasner in the Axa case was not immediately returned.

Related Topics: Fraud Charge Tracker