News: 2009 Press Release
For Release: November 17, 2009
Media Calls Only: 916-492-3566
Insurance Commissioner Poizner Announces Studio City Insurance Broker-Agent Guilty of Grand Theft
California Insurance Commissioner Steve Poizner today announced that Benjamin Thomas Milstead, 45, of Studio City, has been found guilty of three felony counts of grand theft and was sentenced to two years in prison and was ordered to pay restitution. The amount of restitution will be determined at a Jan. 14, 2010 hearing.
"Any agent or broker who attempts to cheat customers by pocketing their premiums and leaving them exposed to losses will face serious consequences," said Commissioner Poizner. "Jail time, fines and restitution are what these unscrupulous criminals will be facing."
According to CDI investigators, from June 2005 through December 2007, Milstead, doing business as LA Credit Insurance Services, accepted more than $212,000 in premium payments from nine businesses for the renewal of existing credit insurance policies and for the purchase of new policies. Milstead either failed to send the premiums to the insurance companies or only sent partial amounts of what was actually collected, retaining the money for personal use.
CDI became aware of the theft when one of the businesses filed a complaint after discovering that Milstead only sent half of the premium payment to the insurance company, resulting in a cancellation notice being sent. In order to keep the business policy active, the owner sent the insurance company an additional check for the balance of the premiums that Milstead had collected, but failed to remit. Milstead's alleged scheme against these businesses exposed them to great financial loss.
The businesses were manufacturers and distributors who sold merchandise to other vendors and retail owners. Merchandise sold by the businesses included electronic components, jewelry, stuffed animals and other various products. The purpose of the credit insurance coverage was to pay the policyholders for merchandise in the absence of their customer paying the obligated amount due after receipt of the merchandise.
Milstead was originally arrested on June 29, 2009. His insurance license expired in August and CDI administrative action against his licensing rights is pending.
Commissioner Poizner oversees 16 CDI Enforcement Branch regional offices throughout the state. Approximately 1,900 insurance fraud-related arrests have been made by the Department of Insurance's enforcement division since Commissioner Poizner took office in 2007 - more arrests than have been made during any other two year period, under any previous insurance commissioner.
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