Former Wis. Agent Sentenced to 4 Years for Insurance Fraud

June 4, 2007

A former top agent for American Family Insurance has been sentenced to four years in prison on 104 criminal counts accusing her of establishing dozens of fraudulent insurance policies.

Waukesha County Circuit Judge Kathryn Foster sentenced Nancy Paquette, 46, of Delafield, also ordering her to serve supervision and probation totaling an additional 16 years.

A jury found Paquette guilty in March of 52 counts of forgery, and 52 counts of identity theft concerning the fraudulent policies. The jury also found her guilty of two counts of theft of a commercial customer’s premiums.

Paquette, a former repeat agent-of-the-year for the company who earned more than $1 million in the four years before her scheme was uncovered, was charged in May 2006 in a criminal complaint that said she paid $200,000 of her own money to establish the policies. In turn, according to the complaint, Paquette collected $265,000 in commissions before the scheme was uncovered.

“There were over 350 suspected fake policies and probably many more,” Assistant District Attorney Lesli Boese told Judge Foster.

Paquette did not testify during her trial. She instead relied on her explanation to American Family Insurance officials before her firing that the falsified policies were taken out by supposed organized-crime figures who later vanished without a trace.

In interviews for a sentencing memorandum, she stuck with the organized-crime story.

“Nancy lost her way somewhere along the way,” defense attorney Paul Bucher said. “The explanation has to be mental health and emotional issues.”

Bucher said that, because Paquette needs treatment, it would be wrong to send her to prison because she would not get it there. He urged a two-year term in the county jail followed by lengthy probation.

Foster denied a request by Bucher to stay the sentence pending appeal.

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