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Elaborate $2.25 million bogus insurance and annuity scheme uncovered

News: 2016 Press Release

For Release: September 23, 2016
Media Calls Only: 916-492-3566
Email Inquiries: cdipress@insurance.ca.gov
Elaborate $2.25 million bogus insurance and annuity scheme uncovered
Insurance agent sold bogus annuities and policies leaving 18 victims with worthless paper
LOS ANGELES, Calif. — Steven Edward Branstetter, 60, of Culver City, was arrested on 13 felony counts of theft from an elder and grand theft for allegedly embezzling over $2.25 million in insurance premiums from 18 southland victims over nine years.

After receiving a complaint from Branstetter's clients who were unable to cash in their annuities, the California Department of Insurance Investigation Division discovered Branstetter allegedly issued fraudulent annuity contracts and life and disability insurance policies and stole their premiums for his personal use.

Branstetter targeted his victims many of them seniors between 2005 and 2014 through his business, LifeCo, allegedly convincing many of them to surrender legitimate policies in order to purchase life, disability products he was selling under the name AIIA Group.

"Branstetter alleged crime make this one of the worst cases of senior financial abuse we have seen in a while," said Insurance Commissioner Dave Jones. "He ruthlessly targeted vulnerable seniors, taking their money, making big promises and leaving them with worthless pieces of paper and no coverage."

Formerly a licensed life agent, Branstetter's license expired in 2013—he did not attempt to renew it. He continued his scam after his license expired.

Bail is set at $715,000.00. The department filed a 1275 bail motion, which requires Branstetter to prove bail funds are not from ill-gotten gains. This case is being prosecuted by the Los Angeles County District Attorney Elder Abuse Section.

Seniors are often the targets of scam artists and unscrupulous agents or brokers. Seniors and their loved ones need to be careful when considering annuities and life insurance investment products to make sure the products are appropriate for their needs. The department offers information to help consumers evaluate insurance product investments. Consumers should also verify the license status of any agent or broker to make sure they have a valid license with no disciplinary actions against them, and lastly, consumers should always contact the insurance company listed on policy to ensure the company actually has a policy on file. Consumers may also contact the Department of Insurance Consumer Hotline for assistance in verifying an agent or broker license and insurance policies by calling toll-free 800-927-4357.

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Media Note:

Arrest photo can be found on our Flickr site:
https://www.flickr.com/photos/ca_dept_insurance/albums/72157670922712394 


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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