Unlicensed insurance agent charged in comp fraud schemePosted On: Oct. 28, 2021 10:47 AM CST
An unlicensed insurance agent was arraigned Wednesday on charges of theft, forgery and embezzlement for an alleged scheme that defrauded three victims out of $1.4 million and left them without workers compensation coverage, the California Insurance Department announced.
Karyl L. Reed, 57, was arrested in Seabrook, Texas, earlier in October and extradited to Orange County.
The Insurance Department said Ms. Reed acted as an insurance agent between 2012 and 2019 and collected work comp premiums through businesses including Envoy Business Partners and Allen Specialty Group. She allegedly provided customers with fake certificates of insurance, leading them to believe they had coverage when they were uninsured.
The department said its investigation found one victim did not have comp coverage when a worker was injured.
“The investigation discovered Reed also operated a staffing company without valid workers compensation coverage and personally adjusted and administered employee injury claims,” the department said.
“She collected workers compensation premiums and payroll, employer and employee taxes from victims, and provided them with falsified certificates of insurance as well leading them to believe they were covered when they were not.”