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CA Department of Insurance

Case Update: Former Bakersfield agent charged in decade-long embezzlement scheme

News: 2017 Press Release

For Release: September 12, 2017
Media Calls Only: 916-492-3566
Case Update: Former Bakersfield agent charged in decade-long embezzlement scheme

CASE UPDATE: Former Bakersfield agent charged in decade-long embezzlement scheme

On September 6, 2017, licensed insurance agent, Valerie Ann Verdugo, pleaded Nolo Contendere to one misdemeanor count of insurance fraud in Kern County Superior Court. Verdugo was sentenced to four days in county jail, three years court probation, 80 hours of community service, $11,000.35 restitution to the victim carrier and $570 in court fines. Verdugo’s license has been suspended. The department is taking appropriate action to revoke Verdugo’s license.

 

Original news release below:

 

BAKERSFIELD, Calif. — Valerie Ann Verdugo, 38, of Bakersfield, is scheduled to be arraigned today on felony insurance fraud charges for obtaining insurance coverage without paying the carrier on those policies for more than a decade.

“Verdugo allegedly used her position as a licensed insurance agent to take advantage of her insurer, which also happened to be her employer,” said Insurance Commissioner Dave Jones.

Verdugo, a licensed agent, surrendered herself to the Kern County Sheriff’s Department and was booked on one felony count of grand theft and one felony count of embezzlement. An investigation by the Department of Insurance’s Investigations Branch uncovered evidence that while working for an insurance agency in Bakersfield, Verdugo would allow her own personal auto and homeowner policies to lapse when premiums were due and then simply write a new policy with minor changes to avoid detection by auditors. When the premium was not paid and the policy lapsed again, Verdugo would allegedly repeat the transaction scheme.

Evidence revealed Verdugo did the same for a number of friends and family, ultimately allowing more than 70 policies to lapse and then rewriting them. According to investigators, Verdugo’s scheme not only provided her with insurance coverage she did not pay for but led to Farmers insurance losing more than $11,000 in uncollected premiums for insurance coverage the company provided.

The Kern County District Attorney’s Office is prosecuting this case. Department of Insurance investigators served Verdugo with a license suspension order on April 16, 2016.

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Media Note:

 



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.

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