Ohio Dept. Takes Role in Fraud Investigation

Director Mary Jo Hudson announced that Ohio Department of Insurance attorney Robert Smith has been appointed to serve as special prosecutor by Fairfield County Prosecutor David Landefeld in an on-going Central-Ohio theft and fraud investigation.

A Fairfield County Grand Jury returned three sets of indictments against a total of nine defendants on Friday, April 18 in a minimum $2.5 million case involving numerous charges of mortgage fraud, vehicle loan fraud, theft, money laundering and income tax evasion.

The Department served as a lead investigator in partnership with the Fairfield County Sheriff’s Office, the Fairfield County Prosecutor’s Office, the National Insurance Crime Bureau (NICB), and other entities in an investigation that started with a suspicious insurance claim filed by ring-leader Huey Granderson. Granderson was convicted in January of 2007 by a Delaware County jury for his role in the theft of a Bobcat from an equipment rental dealership.

“Theft of covered properties means significant claim loss on insurance policies. Overall, this results in higher insurance rates for all Ohioans,” Hudson said. “We will do all we can to fight insurance fraud to assure Ohioans continue to enjoy some of the lowest insurance rates in the country.”

The Fairfield County Sheriff’s Office began its part of the investigation in July of 2007 when it executed a search warrant and recovered numerous pieces of allegedly stolen equipment on land owned by Granderson.

“This is the largest theft ring to our knowledge to have operated in Fairfield County,” Fairfield County Sheriff Dave Phalen said. “The arrests have far-reaching effects well beyond the State of Ohio.”

The Department soon took the lead in investigating more than 15 real estate purchases, 15 motor vehicle purchases and six insurance claims that ring members allegedly participated in since January of 2006. The Grand Jury found that these real estate and vehicle purchases allegedly involved fraud in which the buyers grossly inflated their incomes and submitted bogus federal income tax returns and W-2 forms. The defendants would then allegedly make no payments on the mortgages while renting out the properties and keeping the money. They also allegedly did not make payments on the vehicles and would switch them between ring members so the finance companies were unable to locate the vehicles to repossess them.

Ring members also allegedly continued to steal construction equipment by renting and keeping the equipment, or by simply stealing it from job sites. One member, Kyle Chaney, was recently convicted in Massachusetts for being in possession of a John Deere backhoe that had been stolen in Franklin County. Investigators have so far recovered dozens of pieces of stolen construction equipment and stolen vehicles.

The indictments handed down include the following charges:

• Huey Granderson - RICO, theft, money laundering receiving stolen property, securing writings by deception and failure to pay state income taxes;

• Meagan Kurczewski - RICO, theft, money laundering and filing false state income tax returns;

• Eugene Willis, Jr.- RICO, theft and money laundering;

• Kyle Chaney - RICO and theft;

• Allen Samsal - RICO and theft;

• Brian Denton - RICO and theft;

• Randall Workman - theft, insurance fraud and securing writings by deception;

• Jared Watson - insurance fraud; and

• Rodney Pack- insurance fraud.

The investigation is continuing and more charges are expected.