The word from the Insurance Commissioner’s Office in California;

Formerly licensed insurance agent Tonja Van Roy, 59, who currently resides in Las Vegas, but operated an insurance agency based in Northridge, California, was sentenced to 50 months in prison today on one federal count of wire fraud after a Department of Insurance investigation revealed that she had stolen more than $3.7 million from a premium finance company named AFCO Credit Corporation (AFCO).

The investigation was initiated after the Department received a complaint from AFCO, which alleged that Van Roy had committed insurance premium financing fraud on the company. The complaint alleged Van Roy, through her insurance agency, submitted fictitious loan applications through AFCO’s loan system, which prompted the company to send premium funding payments to Van Roy.

“Insurance agents are in a position of trust, as consumers and businesses rely on them to protect their greatest financial investments, and when agents violate the law and steal from clients, it makes their crime all the more egregious,” said Insurance Commissioner Ricardo Lara. “This case is good example of the important work we are doing to protect Californians by fighting fraud in the system, which is one factor driving up premium costs. I would like to thank my enforcement team and the United State’s Attorney’s Office for their work on this case.”

The investigation revealed that from January of 2021 through December of 2023 Van Roy created and submitted dozens of fraudulent finance agreement forms to AFCO. These fraudulent finance agreement forms deceived AFCO into believing Van Roy had sold insurance policies to her clients, and that those clients were applying for a loan from AFCO to pay the premiums for those policies. AFCO approved the loans noted on the fraudulent finance agreement forms, and then deposited the loan proceeds into Van Roy’s trust account via electronic funds transfer. AFCO believed Van Roy would forward the loan proceeds to the insurance carrier noted on the loan application.

Unbeknownst to AFCO, almost all of the information noted on the fraudulent finance agreement forms was false. For example, the forms contained fictitious insurance policy numbers as well as forged electronic signatures for fictitious insureds. In addition, the forms noted a total of only two different addresses for dozens of different insureds, and both of those addresses were for homes rented by Van Roy.

In total, Van Roy received approximately $3.7 million in stolen payments from AFCO as a result of all of the fraudulent finance agreement forms she submitted to AFCO. Van Roy then used the stolen money to purchase extravagant items for herself and her family members. Since the AFCO loans required repayment within one year, some of the initial loans were repaid by Van Roy. However, the initial fraudulent loans were repaid with the funds Van Roy received from the subsequent fraudulent loans, similar to the pattern seen in a Ponzi scheme. After accounting for Van Roy’s repayment of some of the initial fraudulent loans, Van Roy currently owes AFCO approximately $1.8 million.

This case was prosecuted by the Major Frauds Section of the United States Attorney’s Office in Los Angeles. Homeland Security Investigations also participated in this investigation.

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