TAMPA, Fla. (WFLA) — As Florida homeowners continue to deal with skyrocketing homeowners insurance prices, Florida’s chief financial officer says it’s fraud that’s driving up insurance premiums.
CFO Jimmy Patronis, who is responsible for tackling fraud, stood beside Citizens Property Insurance CEO Barry Gilway in Tampa on Thursday as they announced how they foiled one scheme.
A lawsuit outlines the alleged crimes committed against us all. They say it’s started in 2014. Now, eight years later, there’s a civil settlement but no one has been held criminally responsible.
“We shut the mechanism down solid,” said Gilway.
Eight years ago, Gilway says he noticed attorney Scot Strems and a few contractors were manufacturing claims – 600 claims a year.
According to CFO Patronis, the suspected fraud was costing taxpayers $16 million annually. Fed up, the insurance company, acting alone, filed a civil suit alleging racketeering in June of 2020.
“And how many claims did we get last year? Zero,” said Gilway. “Trust me, it’s not a free roof, you are paying for your neighbors roof, in many many cases.”
Gilway says Mr. Strems denied wrongdoing. But the Florida Supreme Court suspended his license for two years. In March, Strems and his co-defendants agreed to a $1 million settlement.
“This is why your insurance rates are going up,” said CFO Patronis. “Remember, this is fraud, this is a crime.”
So is anyone getting charged in connection with this alleged ring of fraud? Patronis is responsible for investigating fraud, and referring cases to prosecutors.
“Every year that I’ve been in office, about five years now, we have had 3,500-odd arrests, but that goes across auto insurance, health insurance,” said Patronis.
Patronis says, during his time as CFO, 148 have been convicted for property insurance fraud; and the criminal investigation into this alleged ring continues.
8 On Your Side asked if the CFO’s office needs help from federal law enforcement.
“You know I’m sure at some point there could be a multi-state jurisdiction issue over this but I think the men and women we have here are equipped to do it,” he said. “But do we need more boots on the ground, sure.”
At the special session later this month, Patronis will ask lawmakers for more resources. 8 On Your Side will be there to cover it.
In the meantime, Citizens says they referred 400 cases from the alleged ring to the CFO.