Insurance Commissioner Steve Poizner announced that a California Department of Insurance investigation led to the prosecution and sentencing of a Carmel, Calif. resident for grand theft, forgery, tax evasion and transacting insurance without a license.
Michael Vousden, 59, a British citizen and Carmel resident was sentenced to serve 14 years and four months in prison June 5th in the Monterey County Superior Court, and ordered to pay $3.8 million in restitution.
An extensive investigation by the California Department of Insurance (CDI) Investigation Division revealed that Vousden created a bogus insurance company, Security Trust Insurance Limited. Through this company, Vousden marketed and sold medical malpractice insurance to medical personnel throughout California and the United States.
CDI investigators discovered that Vousden failed to obtain a license or any certification from the State of California, that he had issued fraudulent documents, and that he had failed to file any tax returns.
Security Trust Insurance Limited was licensed in the British Virgin Islands until 2001, when Vousden failed to submit audits of his business, as required by the government. The audits would have shown that Vousden’s company had no cash assets to back the fraudulent policies.
Vousden was arrested by CDI investigators in 2004. At that point, he had collected millions of dollars from the sale of illegal bogus malpractice policies. Vousden used the money to purchase expensive artwork and 32 acres of prime real estate in Carmel Valley, where he had been building a residential mansion.
The investigation also revealed that Vousden failed to pay more than $2 million in loss claims, which included claims from death losses.
This case was prosecuted by the Office of the California Attorney General.
Source: California Department of Insurance.
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