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Estates Insurance Fraud Sentencing

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avatarUdut, Kenneth -- on Jan. 31 2009, from Golden Gate Estates, Naples, FL
Founder of this Naples site of NeighborHelp Referrals.

5 years for Hurricane Wilma Insurance fraud.

Estates man gets 5 years for Hurricane Wilma insurance scam


Friday, January 30, 2009

NAPLES — A 40-year-old Golden Gate Estates man who accepted kickbacks for referring Hurricane Wilma home-repair work to a Naples contractor was sent to prison for five years Friday after pleading guilty to a roughly $76,000 insurance fraud scheme.

Edward Joseph O’Neil, once an insurance adjuster for Cincinnati Insurance Co., was adjudicated guilty of scheme to defraud, a first-degree felony, and Collier Circuit Judge Fred Hardt, sentenced him to 10 years of probation after his release. He also ordered him to pay $632.82 monthly over that period to pay off the $75,938.50 in restitution to his former employer.

O’Neil, who wore a suit, said little during his sentencing, except to say he understood he was waiving away his rights to a trial and an appeal. Hardt ordered him to have no contact with contractor Edward Byrnes, who operates K & B Builders in East Naples, and his wife, Diane. Byrnes cooperated with the State Attorney’s Office and his case is pending before another judge.

O’Neil had faced up to 30 years in a state prison, but was sentenced as part of a plea agreement negotiated by Assistant State Attorney Jim Molenaar and defense attorney Burt Stutchin. The prosecutor told the judge on Wednesday that further investigation showed the amount embezzled by O’Neil was more than $100,000.

“I never saw any evidence that would warrant that,” Stutchin said as he left the courthouse after sentencing. “The penalty was severe enough.”

O’Neil faced trial next week and had accepted a plea deal Wednesday, but Hardt rejected the agreement to two years of house arrest followed by probation and restitution. Stutchin tried to withdraw as attorney after Hardt denied a ruling asking that the judge not preside over the case. The motion said Hardt would be biased because he’d worked as counsel for Cincinnati Insurance and understood the workings of the insurance industry.

Hardt angrily denied Stutchin’s interpretation of what he’d said, adding, “I know what I said.”

Stutchin withdrew his motion to withdraw on Wednesday, then reinstated it after Hardt rejected the plea deal. He was to argue the motion Friday, but they reached the plea agreement.

After Hardt was told of the sentence, Stutchin asked for a 90-day furlough so O’Neil could tie up family affairs. “No. Not on a five-year sentence,” Hardt tersely replied.

O’Neil then pleaded with him for time, at least 30 days before he turned himself in for sentencing. “I have a father in law, who has been like a father to me, who has Guillain-Barré disease,” O’Neil said. “My mom lives with me as well and she’s indigent.”

Hardt again refused and said he could plead later or go to trial. Looking like he was about to cry, O’Neil walked outside the courtroom with the attorneys and later returned, pleaded and was sentenced.

His wife, Laurel, who had been at the hearing Wednesday, was not there and learned over the phone her husband would be leaving her and their children for five years. He was given credit for the one day he served in county jail before he posted $15,000 bond five hours after his arrest on March 6. 2008.

Records show Det. John David Salomé of the state Division of Insurance Fraud was contacted by Stephen Lucas of Cincinnati Insurance, who told him O’Neill had issued several checks totaling $56,504.55 to Byrnes, who does business as K&B Builders, for repairs that were never done.

Salomé determined that at least six times between Aug. 23, 2005 and Feb. 17, 2006, O’Neil issued Byrnes checks from the insurance company for storm repairs. The work supposedly was done at a home on Burnt Pine Drive, Fairways at Par IV Condominiums, High Point Country Club and Pebble Shores Condominiums — all in Naples.

Salomé interviewed the homeowner, who said she knew nothing of nearly $8,890 in additional work involving her claim, but said K&B had done some repairs. The property management companies and condominium association said no work had been done at all and they had never hired him. Salomé determined Byrnes deposited six checks in his Fifth-Third Bank account.

Further investigation showed far more checks and bogus work on homes was involved. County records show the O’Neils paid off their mortgages during the time he’s accused of embezzling. They paid off two mortgages on their home at 4558 20th Ave. N.E. in 2005 and 2006, then took out a $262,000 mortgage in April 2006. By November 2007, the bank had filed a notice of its intent to foreclose and foreclosed last June.

In court Wednesday, Molenaar said O’Neil got kickbacks at least 15 times. “They’d drive to Fifth-Third Bank and Mr. Byrnes would give Mr. O’Neil $6,000,” Molenaar told Hardt, adding that more than $100,000 was embezzled from the insurance company.

O’Neil went into coworkers’ computer systems, looking for other clients to solicit work, Molenaar said, adding that work also was referred to O’Neil’s brother-in-law, Peter Krajacic, who is not charged.

Krajacic is the K in K&B Builders, a Palm Harbor company, but Byrnes ran an office from 4545 18th St. N.E., where he also operates Edward Byrnes Contracting. Records show O’Neil met Byrne and persuaded him to go into business with his wife’s brother. The investigation is continuing.

© Naples News
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Estates Insurance Fraud Sentencing 5 years for Hurricane Wilma Insurance fraud.