January 7, 2025 | JacobiJournal.com — Premium finance fraud has again drawn regulatory attention in California, as a former insurance agent pleaded guilty to wire fraud after embezzling over $3.7 million from a premium finance company, according to a California Department of Insurance (CDI) investigation. The case highlights how vulnerabilities in loan verification and client data management can be exploited, underscoring the need for stricter oversight and enhanced auditing measures to prevent similar schemes in the insurance and finance sector.
Tonja Van Roy’s Fraudulent Scheme Unveiled
Tonja Van Roy, 59, who previously ran an insurance agency in Northridge, California, and now resides in Las Vegas, admitted to stealing millions from AFCO Credit Corporation. The fraudulent activities spanned from January 2021 to December 2023, during which Van Roy submitted numerous fictitious loan applications through AFCO’s system, leading to the disbursement of funds directly into her trust account. Former California Insurance Agent
The investigation revealed that Van Roy fabricated details on the loan applications, including fake insurance policy numbers and forged signatures, and used two addresses she rented for multiple fictitious clients. She diverted the funds for personal luxury purchases and repaid initial loans with money from subsequent fraudulent loans, mimicking a Ponzi scheme.
Van Roy’s actions resulted in AFCO disbursing about $3.7 million, of which approximately $1.8 million remains unpaid after some repayments using funds from newer fraudulent loans.
Legal Proceedings and Next Steps
The case, handled by the Major Frauds Section of the U.S. Attorney’s Office in Los Angeles, will see Van Roy return to court for sentencing on March 31. Former California Insurance Agent
To read further, check out the full report on Business Insurance.
FAQs: Premium Finance Fraud California
What is premium finance fraud in California?
Premium finance fraud in California occurs when individuals or agents manipulate loan applications, misappropriate funds, or falsify insurance details to illegally obtain money from finance companies.
How did Tonja Van Roy commit the premium finance fraud?
Van Roy submitted fictitious loan applications, forged signatures, and used multiple fake client addresses to embezzle $3.7 million from AFCO Credit Corporation.
What are the legal consequences of premium finance fraud in California?
Convictions can lead to significant prison time, fines, restitution orders, and permanent professional license revocation for insurance agents involved in fraudulent schemes.
How can premium finance companies prevent fraud in California?
Companies should implement strict verification processes, audit loan applications regularly, monitor for suspicious patterns, and train staff to recognize red flags in client submissions.
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