Nailing the Fraudster

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Posted on 01 Oct 08

Fraud is an ongoing burr under the saddle of the insurance industry. Maybe that is why it is so rewarding when a perpetrator of fraud is caught. The following update was sent to us from Damon Pesce, of storefront owner Maritime General Agency.

The newspapers carried the story this way:

Bergen County Man Charged in Marine Insurance Fraud

Attorney General Anne Milgram and Criminal Justice Director Deborah L. Gramiccioni announced that a Garfield man has been indicted on charges he filed more than $60,000 worth of fraudulent marine insurance claims.

According to Insurance Fraud Prosecutor Greta Gooden Brown, John Getchius, 59 - aka Robert Allen, John Gechies, John Gechius, John Cetchies, John Goetsche, Andrew Grego, and Tracy Greenberg - was charged with three counts of second-degree insurance fraud and five counts of third-degree insurance fraud. The Bergen County grand jury indictment was voted on July 31 and handed up in Superior Court yesterday.

The indictment alleges that between Feb. 25, 2004, and Dec. 27, 2007, Getchius used a variety of aliases and assumed identities to commit insurance fraud involving marine insurance policies. Getchius, a lawyer who was disbarred in 1988 for unrelated reasons, allegedly submitted $64,000 worth of fictitious insurance claims alleging that five dinghies, five outboard motors, a life raft and a marine tender were lost at sea on various dates. The fraudulent claims were submitted to several insurance companies, including the New Hampshire Insurance Company, the Northern Assurance Company of America, the Quadrant Indemnity Company, the Vigilant (Chubb) Insurance Company, and the Zurich/Northern Insurance Company of New York. Getchius allegedly was paid $25,500 as a result of the false claims.

Detective Earl Washington and Deputy Attorney General Dennis Kwasnik were assigned to the investigation. Kwasnik presented the case to the Bergen County grand jury. Insurance Fraud Prosecutor Brown thanked the New Hampshire Insurance Company, the Northern Assurance Company of America, the Quadrant Indemnity Company, the Vigilant (Chubb) Insurance Company, and the Zurich/Northern Insurance Company of New York for their assistance in this matter, and Chubb Insurance Company for referring this matter.

The indictment is merely an accusation and the defendant is presumed innocent until proven guilty. Second-degree crimes carry a maximum sentence of 10 years in state prison and a criminal fine of $150,000, while third-degree crimes carry a maximum sentence of five years in prison and a fine of $15,000. Getchius may also face civil insurance fraud fines.

As Paul Harvey would say, “Now, for the rest of the story.”

Here is what Damon wrote us as he filled in the blanks of how this fraudster was identified and how the trap was sprung:

We finally got one! I am giving you all of the details to this story and I will let you dissect the information you want and write what you think is appropriate. (Ed. Note: We are publishing Damon’s information as he wrote it.)

First, so you understand who we are, Maritime General Agency (MGA) is the program administrator for New Hampshire Insurance Company (AIG) for their recreational marine insurance. Since 1991 MGA has held writing authority nationally for AIG's marinas, boat dealers, yacht clubs, boats, yachts and charter boats. We write over 1,200 marinas, boat dealers & yacht clubs and insure over $6.8 billion worth of boats. We write through our network of appointed brokers.

Windward Marine Underwriters (WMU) is the program administrator for Vigilant Insurance (a Chubb member company) for boats/yachts and a wholesaler for Chubb Custom Markets for Marinas, boat dealers and boat builders.

Both MGA and WMU are owned by Gowrie Barden & Brett. Even though all facilities are separate in location and staff, I am the marketing director for both companies, MGA & WMU.

March '07, I get a call from one of our Long Island brokers, Doug Cabral. Doug tells me he met a guy at the NY Boat Show in December. He placed this guy's 96' Berger worth $6.5 million with Travelers. They immediately received a claim from the insured for a stolen tender. Travelers paid out ~ $20k before they realized the insured's check had insufficient funds. The policy cancelled and Doug was penalized with $4,800 for the unearned premium. Doug is upset and gives me the details hoping it will come around at some point so the guy gets caught. Doug shared with me that the name of the insured is John Gechius, but he allegedly has aliases that include John Cetchies, John Goetsche, Andrew Grego.

After hearing Doug's story, I conducted a name search in MGA's database to find that we had received submissions on several these of Aliases from brokers throughout the Mid-Atlantic and Northeast region different applications for insurance. Some were just submissions but there was one in which we declined a claim because the policy cancelled for non payment.

I informed all of the MGA and WMU underwriting staff to be on watch for any suspicious submissions and gave them the full story.

Shortly after, one of our MGA underwriters accidently found that we had written a 48' 2003 Hylas, for an insured out of NJ under the name Robert Allen. We bound the policy with New Hampshire Insurance Company on 2/26/04, paid a $6,000 lost tender (dinghy) claim on 3/13/04, and cancelled the policy shortly after for non payment after the insured's check bounced. This obviously smelled like the same scam, so I reported the incident to the NJ Deputy Attorney General, Dennis Kwasnik, who then opened a case to investigate.

In November, 07, I get a call from one of our yacht underwriters. One of the WMU underwriter assistants fielded a call from a direct insured. We rarely get calls direct from the insured as inquiries and issues are supposed to be routed through the brokers. The insured was irate with her and yelled and cursed, demanding she expedite his lost tender claim so he can get paid. When she started to discuss the details with our underwriting staff, they immediately thought the scenario looked suspiciously familiar. We checked on his account balance, which showed his check had sufficient funds and notice of cancellation was about to get mailed out.

We immediately contact NJ Deputy Attorney General, Dennis Kwasnik again, but this time to inform him that we had the guy in the middle of the act. Deputy Attorney General, Kwasnik asked us to play along to verify this was the same individual and we did. We held out sending the cancellation notice and informed claims. We called back Mr. Greenberg (actually John Getchius) and told him we were expediting the claims process, but we needed him to complete a claims statement, of which he did and then he sent it to our office via overnight delivery it to our office. We then obtained an address in which he wanted us to mail his claims settlement check to. The address, handwriting and check numbers form his premium deposit check that bounced, helped the NJ Deputy Attorney General confirm we had the same individual.

The NJ Deputy Attorney General, in conjunction with the state police, staked out the address until John Getchius came to check the mail. The address turned out to be his elderly mother's address and the police arrested him onsite.

Here are some facts I received direct from NJ Deputy Attorney General, Dennis Kwasnik: