N.J. Agent Caught in Sales Commission Scam

December 21, 2004

New Jersey Division of Criminal Justice Director Vaughn McKoy announced that a Monmouth County insurance agent was ordered to pay more than $43,600 in restitution after pleading guilty to stealing insurance sales commissions to which he was not entitled.

According to Insurance Fraud Prosecutor Greta Gooden-Brown, Ralph Malek, aka Raafat Abdel Malek, 29, of Farmingdale, Monmouth County, was ordered by Monmouth County Superior Court Judge Bette Uhrmacher to pay $43,648 in restitution and to serve five years probation. Malek was sentenced after pleading guilty to a criminal Accusation filed by the Division of Criminal Justice, charging him with theft by deception (3rd degree).

At the Oct. 1 guilty plea, Malek reportedly admitted that between Aug. 23, 1999 and July 5, 2000, to stealing $43,648 from the Baltimore, Md., Fidelity and Guaranty Life Insurance Company. Malek admitted that he submitted a fraudulent annuity insurance application and a fraudulent $87,500 check drawn on the account of Contaldo’s Specialties, a business Malek formerly owned, to the Fidelity and Guaranty Life Insurance Company. As a result of the transaction, Fidelity and Guaranty Life Insurance advanced Malek $7,875 in insurance agent commissions.

Additionally, Malek admitted to using the same scheme to submit a second fraudulent annuity application to Fidelity and Guaranty Life Insurance using the name of a second fictitious applicant. Malek paid for the insurance premium with a fraudulent $436,487 check drafted on the business account of L.R. Food Deli Inc. – another business formerly operated by Malek. That check, along with a replacement check from a third business formerly operated by Malek, were fraudulent. Fidelity and Guaranty Life Insurance advanced Malek insurance agent sales commissions of $35,773.

In total, Malek stole $43,648 from Fidelity and Guaranty Life Insurance Company by issuing worthless insurance premium checks and insurance applications containing fraudulent information.

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