Crooked public servants serve themselves

By James Quiggle
January 13, 2014

imageAmerica’s elected legislators, judges and others pledge a sacred trust to uphold the law. Some officials find that stealing a glittering pot of insurance money appeals more than protecting triflings such as democracy and the trust of voters.

The vast majority of America’s public servants are honorable. Then comes former U.S. Rep. Rick Renzi. The Arizona Republican stole more than $400,000 in client premiums from his family insurance agency to finance his 2002 congressional campaign, then covered up the double-dealing.

Renzi had a small family-owned agency ironically named the Patriot Insurance Agency in southern Arizona. The agency specialized in covering nonprofits, including right-to-life groups and pregnancy-crisis centers. Renzi is a conservative with 12 children and who professed strong religious faith in working with constituents.

Federal prosecutors successfully fashioned this version of the evidence for trial: Renzi stole the premium money his clients had entrusted him to pay for their insurance needs. He laundered the loot through the firm’s operating account, then into his personal bank accounts. His trusting clients had no coverage and were dangerously exposed to potential catastrophe.

imageRenzi stuffed much of the money into his campaign coffers. The client premiums also paid personal expenses such as a large IRS bill and airline tickets for family members.

Clients only learned Renzi had swindled them when insurance companies canceled their policies for nonpayment. He’d sent clients fake insurance certificates from another so-called insurer called Jimcor. But Jimcor was merely an insurance broker, and thus didn’t provide coverage like an insurer.

Concerned regulators began investigating. Renzi launched a determined coverup. The Jimcor insurance policies were issued due to a clerical error, he lied to insurance regulators in a letter on Renzi & Co. letterhead. Bad timing, disputes with insurers and innocent delays in obtaining lines of credit for premiums also helped explained the mess, he said.

The Federal Election Commission probed the large infusion of campaign money. He’d simply loaned the money to his election campaign coffers, Renzi lied on federal election forms.

“When insurance fraud corrupts leaders, a jail cell gives Americans a worthy civics lesson that democracy is alive and well.”Renzi once held a seat on the powerful House Intelligence Committee. But now he can ponder the intelligence of his insurance dealings. Renzi was convicted on corruption charges in June, including an unrelated illegal land swap. He received three years in federal prison. Renzi is scheduled to report to prison in January, but says he’s innocent and will appeal.

Renzi’s conviction brings to mind other public officials who stole insurance money.

• Consider former Hackensack, N.J. police chief Ken Zisa. His girlfriend allegedly was driving drunk one evening and crashed Zisa’s Chevy Trailblazer into a utility pole. He ordered the officers to write up a false report that she’d swerved to avoid an animal.

Zisa’s 34-year career with the force dissolved when he filed a fraudulent $11,000 damage damage claim with his auto insurer, still lying about the wayward animal. He received five years in prison in September 2012, and must repay the insurance company.

• Pennsylvania appellate judge Michael Joyce claimed a Ford Explorer hit his Mercedes. The Erie-area man was left with continuous back, neck and arm pain, he said. He extracted $440,000 total from his auto policy and the other driver’s coverage.

Meanwhile, the supposedly crippled judge obtained his airplane pilot’s license, golfed at world-class resorts, worked out at a fitness center and went roller-blading. Joyce received nearly four years in prison in 2009.

Americans depend on the integrity of their chosen leaders. They are the heartbeat of democracy. When insurance fraud corrupts leaders, a jail cell gives Americans a worthy civics lesson that democracy is alive and well.

As federal prosecutor Mythili Raman said of Renzi: “Former Congressman Renzi's streak of criminal activity was a betrayal of the public trust and abuse of the political process.

“After years of misconduct as a businessman, political candidate and member of Congress, Mr. Renzi now faces the consequences for breaking the laws that he took an oath to support and defend.”

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