The Lords Insurance Blog

Making Insurance

Insurance fraud defendants make court appearance

The owners and financial officer of a Rancho Cucamonga disaster-restoration company charged in a multimillion dollar insurance fraud and forgery case will be allowed to access a small portion of their frozen assets to cover day-to-day living expenses, a San Bernardino County Superior Court judge ordered Wednesday.

But the bulk of the assets controlled by Steven Manchester, Bob Roberts Jr. and Heather Reavis — estimated at between $260,000 and $270,000 — will remain out of their reach while the criminal case proceeds.

Judge Michael Libutti’s order came at a court hearing where San Bernardinoprosecutor David W. Simon said he may file more charges of workers’ compensation fraud against Manchester, Roberts and Reavis and theServiceMaster franchises they operate.

Simon, the lead deputy district attorney in the worker’s compensation fraud unit of the San Bernardino County district attorney’s office, told Libutti that state Department of Insurance investigators are still conducting interviews.“I expect substantial additional reports by the end of the week,” he said.

Libutti ordered that Manchester and Roberts, the owners of ServiceMasterfranchises in Rancho Cucamonga and Tustin, will receive $15,000 each.

Controller Heather Reavis will receive about $7,000..

Manchester, Roberts and Reavis all were in court Wednesday but made no statements. They left the courtroom without comment.

The three are due back in court June 22 for a hearing.

Manchester, 50, Roberts, 51 and Reavis, 40 are facing 45 felony counts including grand theft and forgery. Their arrests in mid-April culminated a four-year probe by the Department of Insurance.

The three have entered not guilty pleas.

ServiceMaster is hired to repair fire, smoke and water damage to homes and businesses.

Investigators said the three defendants were involved in a scheme in which they cashed insurance company checks by forging homeowner signatures and fraudulently endorsing mortgage companies’ banking information on the back of the checks.

Work that the checks were meant to pay for was not completed by their company and, in some cases, no work was done, which led to more charges, investigators said.

Jeffrey Benice, the attorney representing Roberts and ServiceMaster, could not be reached for comment Wednesday. But in previous comments, he maintained the Department of Insurance had made a “serious error” in alleging crimes had been committed.

He described ServiceMaster as a “successful, well-respected business.”

In at least one case involving a Mira Loma family who hired ServiceMaster to repair fire and smoke damage to their home, the asset freeze is causing major hardship because they are unable to recoup the $165,000 they gave the company for repairs that were never done.

Simon and Deputy District Attorney James Secord who also is working on the case, said after the hearing the asset seizure is a crucial part of the case although it results in an inconvenience for some victims.

“Our focus has to be on what’s best for all of the victims,” Secord said.

Press Enterprise

Advertisements

Written by lordsinsurancelog

May 20, 2011 at 7:32 pm

Posted in Insurance News