An insurance broker accused of swindling a national insurer out of more than $140,000 in commissions through a pyramid scheme was charged with grand theft, the California Department of Insurance announced Monday.
Angel Estrada, 22, a formerly licensed insurance producer and owner of Angel Estrada Agency, allegedly wrote bogus commercial insurance policies to earn large commissions.
According to department investigators, Estrada submitted 74 applications for commercial insurance policies between 2016 and 2017 and was rewarded for the new business with large commissions. Estrada then used a portion of his commission money to fund initial premium payments on new bogus policy applications to secure more commissions.
Investigators allege Estrada continued this practice until the insurer audited his business and revealed the alleged scam.
The audit found only one of the 74 policies submitted had an actual premium payment, according to the CDI
“Estrada’s fraudulent activity degrades consumers’ trust of professional agents,” Insurance Commissioner Ricardo Lara said. “These types of crimes are costly to California’s consumers, businesses and economy.”
A warrant was issued for Estrada’s arrest and he surrendered to authorities in court on Friday. He was released on his own recognizance pending trial.
The department suspended Estrada’s license April 11.