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Accelerated Benefits Corp. charged with Fraud

July 3, 2000: Florida charged ABC with engaging in "fraudulent or dishonest practices" in the purchase of 11 fraudulently obtained life insurance policies from policyholders who allegedly lied about their HIV status to obtain the insurance. This type of fraud is known as "clean-sheeting."

Bill Nelson, State Treasurer and Insurance Commissioner in Florida, also charged Accelerated Benefits Corporation with "failure to report knowledge or belief of commission of a fraudulent insurance act."

Nelson said that evidence shows ABC helped to conceal the fraud from insurance companies. In 6 of the policies purchased, an employee of ABC paid the policy premiums from a personal checking account, allegedly to hide the fact that a sale had been entered into prior to the expiration of the contestability period.

Eight insurance companies were affected. The policies are alleged to have been purchased through 6 different brokers.

Nelson notified ABC that he intends to revoke the company's license or impose other penalties. The administrative order gives ABC 21 days to request a hearing  before the Division of Administrative Hearings, if it wants to contest the charges.

To read about ABC's regulatory troubles, click HERE

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