Bay Area Man Sentenced To Ten Years In Prison for Selling Fake Insurance Policies

Insurance Commissioner Steve Poizner announced today the sentencing of a former insurance broker/agent to 10 years in prison for the sale of approximately $6 million worth of fake insurance policies the broker falsely claimed were underwritten by Lloyd's of London (Lloyd's).

According to California Department of Insurance (CDI) investigators, Richard W. Peterson (also known as Robert James), 66, of San Francisco, operated an insurance brokerage firm that claimed to specialize in the placement of commercial liability insurance for restaurants and bars. Between 2000 and 2003, Peterson issued commercial liability insurance policies he said he placed with underwriters at Lloyd's and obtained through two New York insurance brokerages; Surplus Lines, Inc. and Heritage, Inc. When a broker tried to confirm coverage, he found the policies were completely fraudulent and had not been placed with underwriters at Lloyd's.

"Mr. Peterson's fraud could have financially devastated these small businesses," said Commissioner Poizner. "Not only was he illegally pocketing millions of dollars in premiums, but his actions left many San Francisco restaurants unprotected and vulnerable. I am glad to announce today that Mr. Peterson has been ordered to pay back that money. Read more at insurance.ca.gov.