Those of us in the trenches know that there is an epidemic of insurance fraud and barratry in Texas hail claims. Well, there is now undeniable proof. On Friday, well-known hail attorney Kent Livesay appeared in a Tarrant County courtroom and entered a guilty plea to insurance fraud and barratry occurring in Texas hail claims. As part of his guilty plea, Livesay accepted a 5-year prison sentence. YES, THAT’S RIGHT. A Texas attorney has pleaded guilty and is going to prison for five years for committing insurance fraud and barratry in hail claims. A copy of his plea agreement is available here. A 343 page listing of evidence accumulated by the TDI and Tarrant County District Attorney used to support the indictment is available here.
And the story gets even more interesting. As part of his guilty plea, Livesay agreed to appear in open court and lay out the details of the entire fraud and barratry scheme. In disclosing these details, Livesay implicated House of Tomorrow/Lambco owner Jorge Garcia, public adjuster Sandra Harrison of PA Forensics, and estimator Sandra Villareal of Global Estimating. Livesay alleged that he paid them up to $1,000 per case disguised as an estimate fee. Livesay also mentioned several other attorneys who he understood were also working with House of Tomorrow/Lambco.
Those names may sound very familiar to you because for almost two years now Zelle has been pursuing a class action lawsuit against all of these individuals in which we allege that they stole over $500,000 in insurance checks from over 100 minority and elderly homeowners. A copy of our class action petition is available here (start reading at page 9 for a detailed description of the scheme). Here is a link to a CBS11 news report and a link to a Dallas Morning News article about the alleged scheme.
With Livesay’s testimony clearly implicating all of these actors, one can reasonably predict that additional indictments may soon follow. Perhaps the TDI will also investigate whether these individuals were truthful or if they committed perjury when I took their depositions last year.
Yes, I know what you are all thinking… “Wait a minute Badger. Lawyers are still paying roofing contractors and other case solicitors $1,000 to $1,500 for estimates that have a real value of only $300 to $500 in exchange for the contractor or case solicitor giving the lawyer’s name to homeowners. Why isn’t that also illegal?”
Perhaps it is. Time will tell whether investigations of other similar schemes, including those taking place in Harvey claims, remain ongoing.
Thanks to the TDI Fraud Unit and the Enforcement Division for making this a priority issue for the benefit of insurance companies doing business in Texas and, more importantly, for Texas insurance consumers who are the ultimate victims of these schemes.