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Insurance Commissioner Dave Jones announces sentencing of former Orange County Agent for Premium Fraud

Dave Althausen
December 30, 2011 9:49 AM

On October 28, 2011, Michael Steven Busch, 63, pled guilty to one felony count for violating Penal Code section 487, Grand Theft, and one felony count for violating Penal Code section 000, Forgery in Orange County Superior Court. As part of his felony plea agreement he was sentenced to a suspended state prison term of 3 years and 8 months. Busch was ordered to serve 180-days in jail, five years formal probation and ordered to pay $32,568.48 in restitution plus $500.00 in fines and court fees. Additionally, the California Department of Insurance (CDI) revoked his license to sell insurance effective August 12, 2011.

According to CDI Investigators, it had been revealed that between December 29, 2006 and December 31, 2006 while acting as an insurance agent, Busch stole $32,568.48 from a policyholder located in Irvine, CA. Busch, as instructed by the policyholder, obtained a renewal quote for an earthquake policy that provided $5,000,000 in coverage with an annual premium of $75,895.53. The policyholder instructed Busch to bind the policy and submitted a check for the full premium due. Busch subsequently obtained an additional quote, without the knowledge of the policyholder, for a policy that provided only $2,000,000 in coverage with an annual premium of $45,798. Busch bound the policy with the lower coverage limits and premium rather than the policy that the insured had instructed him to purchase. Busch submitted a check for $43,327.05 to the insurance company and stole the remaining $32,568.48 which had been remitted as premium, for his personal use.

Additionally, Busch altered the policy documents from the actual coverage amounts of $2,000,000 to reflect the higher coverage amounts of $5,000,000 in order to further deceive the policyholder.

This case was prosecuted by the Orange County District Attorney's Office.

 

 

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