Six sentenced in multi-million dollar scam targeting Verizon Wireless
News: 2015 Press Release
SACRAMENTO, Calif. - Six individuals involved in a mobile phone insurance scam were sentenced on felony fraud charges after filing more than 1,300 claims for stolen and damaged phones totaling more than half a million dollars. The convicted scammers, including some Verizon Wireless employees, were arrested by Department of Insurance detectives and Los Angeles Police Department officers in May 2013.
"Insurance fraud is an expensive drain on the state's economy, totaling billions of dollars annually. The cost of these scams is passed along to consumers through higher insurance rates," said Insurance Commissioner Dave Jones. "Thanks to the superior work of department detectives and aggressive prosecution by the district attorney, we were able to shut down their criminal enterprise."
Through the course of the investigation, detectives discovered at least three Verizon employees accessed consumer account information to identify customers with high-end phones and file insurance claims for what they claimed were damaged or stolen phones. The replacement phones were shipped to the conspirators' homes. Three additional co-conspirators had phones sent to their homes and hotels. Detectives identified Louis Lovett, 31, of Sacramento, as the mastermind behind the scheme. The fraudulent claims totaled approximately $636,000. According to detectives, there is no indication that consumer identities or personal account information was stolen or used by suspects.
"As the department noted, we have no indication that any personal account information was stolen or any customers harmed. We take the protection and privacy of our customers' accounts very seriously and congratulate the insurance commissioner and the district attorney for their handling of this case," a Verizon spokesman said.
Court ordered restitution of $636,265 was ordered to be paid to Asurion, the mobile protection insurance company that was defrauded.
As the mastermind behind the crime, Lovett was ordered to repay the entire fraud loss amount, but all individuals are held responsible for ensuring the restitution is paid. In effect, the remaining five suspects were ordered restitution based on the agreed upon amount of their apportioned responsibility.
This case was prosecuted by the Sacramento District Attorney's Office. All six individuals pleaded no contest to multiple felony counts of insurance fraud. The sentencing information for each is as follows:
- Louis Lovett, 31;sentenced on 07/17/15 to 10 years in County Jail (6 years in custody and 4 years probation);ordered to pay $636,265 in restitution.
- Aleta Pinkney, 33;sentenced on 07/17/15 to 3 years in County Jail and 18 months probation;ordered to pay $102,000 in restitution.
- Nicholas Brown, 27;sentenced on 05/29/15 to 2 years in County Jail;ordered to pay $217,000 in restitution.
- Antonio Miller, 26;sentenced on 05/29/15 to 2 years in County Jail;ordered to pay $164,000 in restitution.
- Anthony Stanford, 26;sentenced on 07/17/15 to 364 days in County Jail and 5 years formal probation;ordered to pay $57,000 in restitution.
- Adi Qalivutu, 23;sentenced on 07/15/15 to 364 days in County Jail and 5 years formal probation;ordered to pay $57,000 in restitution.
According to detectives, there is no indication that consumer identities or personal account information was stolen or used by suspects.
- Photos of suspects: http://bit.ly/10ITviP. Nicholas Brown booking photo: http://bit.ly/1DxmqiY
- Case background: In December of 2010 Asurion Insurance Services reported a suspected insurance fraud ring. The scam involved using personal information to receive replacement mobile phones based on false insurance claims. Three employees of a major mobile phone carrier accessed confidential customer information, specifically targeting customers with high value cell phones and insurance policies. Accomplices then used the stolen information to file more than 1,900 fraudulent insurance claims, with a total provable loss valued at $636,265.
- Stanford and Brown may have been living in Southern California prior to their conviction.
- Qalivutu may have been living in Yolo County prior to conviction.
- Lovett, Pinkney, Miller, Stanford and Qalivutu were arrested by the Department of Insurance on May 16, 2013 in Sacramento.
- Brown was arrested by the Los Angeles Police Department on May 17, 2013 in Van Nuys.
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $289 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $394 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.