LDI Fines Public Adjuster Accused of Pocketing Insurer Payouts

By Jim Sams | August 25, 2022

The Louisiana Department of Insurance has ordered a Texas father-and-son public adjusting team to pay a $50,000 fine for pocketing money that was intended for insurance claimants.

The department on Aug. 18 revoked the public adjuster license issued to Kade Austen Mitchell and ordered him and his company, Mitchell Adjusting International, to pay the fine after learning that no money had been refunded to clients as promised. The department also suspended a non-resident public adjuster license issued to Kade Mitchell’s father, Andrew Joseph Mitchell.

“The actions by these two men to defraud insureds is especially egregious when folks are trying to get their homes, businesses, and lives back in order,” said Louisiana Insurance Commissioner Jim Donelon in a press release. “The LDI will remain diligent in the investigation of fraud committed against Louisiana residents.”

Andrew Mitchell is listed as manager and director of Mitchell Adjusting International, located in Kemah, Texas, in business records filed with the Texas Secretary of State’s Office. Kade Mitchell is listed as a registered agent.

LDI on July 22 suspended Kade Mitchell’s public adjusting license, charging that he had cashed insurer checks totaling $267,441.43 without passing any of the money along to the policyholders who hired him.

The Texas Department of Insurance also took administrative action against the company and the Mitchells in June for a similar alleged scam that reportedly took more than $300,000 in checks intended for policyholders.

In the meantime, at least two factoring companies are seeking to recover payments made to Mitchell Adjusting International. A third company has won a collection judgment from a New York State court, the Claims Journal reported last week.

According to a cease-and-desist order issued by the Louisiana Department of Insurance on Aug. 16, Andrew Mitchell sent an email to the department on July 28 stating that he had repaid a $150,000 insurance payout that was intended for the New Hope Baptist Church in New Orleans. He attached to the email an electronic copy of a check made out to the church.

But investigators determined that the check had not been cashed or deposited and there were not sufficient funds in the bank account to pay that amount anyway, the order says.

The department received a second email from Andrew Mitchell on the same day that also included attached copies of two checks totaling $117,441.43 made out to a State Farm policyholder.

“The checks supplied by you via email, and the representation made by you, purporting the return of the claim payments misappropriated by Mitchell Adjusting International, LLC have been determined by the LDI to be false or fraudulent,” the order states.

The order directs Andrew Mitchell to cease and desist from conducting all activity in the business of insurance. A separate Aug. 18 order issued to Kade Mitchell orders him and Mitchell Adjusting International to pay a $50,000 fine.

Deputy Louisiana Insurance Commissioner Nathan Strebeck declined to comment Wednesday when asked if the department has any hope of ever receiving that $50,000.

The website address for Mitchell Adjusting International returns an error message. The Mitchells do not respond to emails sent to the addresses listed in public records. The attorney who is representing Andrew Mitchell in the Texas Department of Insurance enforcement action did not respond to requests for comment. Correspondence that the Texas Insurance Department mailed to the businesses address was returned as “unable to forward.”

The Texas Department of Insurance is seeking to revoke a public adjuster license issued to Andrew Mitchell based on allegations that he pocketed insurer payout checks totaling $335,082.56 intended for seven policyholders. A hearing before the State Office of Administrative Hearings is scheduled for Oct. 12.

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