8.5M Judgement Obtained Against Company

Florida Attorney General Bill McCollum announced that his office has obtained a final judgment for $8.5 million against two owners of a company that was reportedly selling insurance-like products to senior Floridians, but failed to pay most claims.

The company stopped writing business in Florida after the Attorney General filed this lawsuit. Marc Orth and Thomas Muldoon, the two principals of Homeward Bound Services of North America Inc. were ordered by a Leon County Circuit Court judge to pay $8.5 million in civil damages, of which more than $250,000 will be available for consumer restitution. The case was litigated by the Attorney General’s Economic Crimes Division.

An investigation by the Attorney General’s Economic Crimes Division revealed that Homeward Bound targeted senior citizens, selling policies for personal care services. The policies were intended to pay for a specified number of hours contracted for basic care services which included meal preparation, bathing, laundry, house cleaning, etc. The company had been selling policies in Florida since 2004 and reportedly routinely failed to pay for the promised services, often leaving a heavy financial burden on its elderly customers and depriving them of the much needed services.

The company was originally investigated by the Florida Department of Financial Services for selling a discount medical plan. However, Homeward Bound reportedly changed its contract, thus avoiding regulation under the insurance code. The Economic Crimes Division launched its investigation into the company in March 2007 after receiving complaints from several health care providers and senior citizens. The lawsuit was filed in May 2007 and alleged that the company subcontracted to local providers but routinely failed to pay them for the services provided to consumers.

Under Florida’s Unfair and Deceptive Trade Practice Act, the Homeward Bound officers, Orth and Muldoon are personally liable for actions of the company.

Both men reportedly admitted in court that they knew the advertising was false and that employees had been directed to provide false information about claims payments to consumers. Homeward Bound was not named in the final judgment because it entered bankruptcy during the course of the proceedings and has no ability to pay.