“The size and scope of McClenny, Moseley & Associates’ illegal insurance scheme is like nothing I’ve seen before,” mentioned Louisiana Commissioner of Insurance Jim Donelon.
“It’s rare for the department to issue regulatory actions against entities we don’t regulate, but in this case, the order is necessary to protect policyholders from the firm’s fraudulent insurance activity.”
Also named on the cease-and-desist discover have been McLenny, Moseley & Associates (MMA) founding companions John “Zach” Moseley and James McLenny, and MMA Louisiana managing accomplice William Huye.
The LDI has urged any policyholders who consider they might have been fraudulently represented by the agency to get in contact with its workplace of insurance coverage fraud. An investigation is ongoing.
What has McLenny Moseley been accused of?
In the cease-and-desist order, MMA was accused by Louisiana Commissioner of Insurance Jim Donelon of getting engaged in a “fraudulent scheme involving fraudulent insurance acts” involving 100s of hurricane-related claims within the state.
The agency filed greater than 1,500 hurricane declare lawsuits in Louisiana within the area of three months final yr, based on the LDI.
Evidence in possession of the LDI confirmed that MMA had “fraudulently misrepresented to multiple Louisiana insurance companies that MMA had been retained by Louisiana insureds … [relating to] hurricane insurance claims without the knowledge of the insureds that MMA purported to represent”, based on the discover.
Instead, McLenny Moseley was appearing on behalf of roofing firm APEX Roofing and Restoration (APEX), the discover alleged.
As per a February 1 courtroom transcript, MMA admitted to having despatched letters of illustration on behalf of insureds when it didn’t characterize them. It additional admitted to having settled 11 claims and filed one lawsuit with out insureds’ consent.
MMA went on to confess to 856 misrepresentations, based on the discover. In one occasion, an insured couple solely realized of the “fraudulent claim representation” when mortgage holder and listed payee Chase Bank endorsed and despatched them a verify.
MMA additional admitted to having settled 9 extra claims by which it didn’t characterize insureds, based on the discover.
Last yr, insurance coverage trade insiders informed this publication that they and their relations had acquired unsolicited messages from the agency in query encouraging them to assert.
Moseley has beforehand informed Roofing Insights that MMA may have “around 15,000” purchasers within the state and it has harbored ambitions so as to add tens of hundreds extra.
“Our goal is to help 50,000 people in Louisiana – we want to help rebuild Louisiana,” he mentioned in a 2022 video interview.
“Disturbing” claims ways have been surging in Louisiana, Insurance Business has beforehand reported. In August, Independent Insurance Agents & Brokers of Louisiana CEO Jeff Albright, decried a rash of “opportunistic” approaches.
This month, Louisiana Governor John Bel Edwards signed two Bills into legislation as a part of a bid to prop up the state’s ailing property insurance coverage market, which has confronted a stream of insurer exits after a sequence of hurricane hits.
MMA targets Florida in wake of Hurricane Ian
Texas domiciled MMA has additionally arrange a “free Hurricane Ian helpline”, based on its web site.
Insured losses from Hurricane Ian might be as excessive as $74 billion, based on RMS estimates, with an Insurance Information Institute spokesperson having warned previous to a December particular session that authorized prices may add as much as $20 billion to the invoice.
MMA was taken to process over its mass settlement and promoting ways in courtroom in October, at which era a federal decide mentioned he feared that the agency could search to benefit from the devastation left behind by lethal Hurricane Ian in Florida. He additionally criticized MMA for charging a 40% lower.
“My job is to administer justice, protect the bar, and protect the judicial process,” Judge James D Cain mentioned, as per a transcript seen by Insurance Business. “So you could go attempt to pull this stunt in Florida as a result of I’ve already seen y’alls commercials.
“Shame on you. Shame on you for trying to prey on people.”
MMA has been contacted for remark.