Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that NANCY CREDIDIO, the former manager of a car insurance brokerage, was sentenced to 33 months in prison for defrauding more than 1,100 victim customers out of more than $415,000. CREDIDIO previously pled guilty to conspiracy to commit wire and mail fraud before United States District Judge Paul A. Engelmayer, who also imposed today’s sentence.
U.S. Attorney Geoffrey S. Berman stated: “For many years, Nancy Credidio duped car insurance applicants and car insurance companies alike. She lied to them – defrauding insurance applicants out of hundreds of thousands of dollars – to benefit herself. Today’s sentence sends a clear message that those who commit such fraud will face serious consequences.”
According to the allegations in the Information to which CREDIDIO pled guilty, public court filings, and statements made in court:
In order to legally drive a car in New York State, the car must be covered by an insurance policy. From in or around 2010 through in or around 2017, CREDIDIO was a manager at a Queens, New York–based entity that sold such insurance policies. During that period, CREDIDIO participated in various fraudulent practices.
First, CREDIDIO made various misrepresentations that hurt more than 1,100 insurance applicants and deprived them of more than $415,000 in connection with a roadside assistance program (the “RAP”). Specifically, CREDIDIO duped applicants into buying the RAP, whereby applicants spent much more on the RAP than they could possibly have received in return. (Applicants often paid $465 for the RAP for one year, even though the most that they could have possibly received in return was $250.) In some instances, CREDIDIO simply enrolled applicants in the RAP by signing their signature without their consent. In other instances, CREDIDIO lied to applicants by falsely claiming that they were required to purchase the RAP in order to obtain car insurance. On average, each victim spent more than $300 on the RAP and received less than $3 in return. In order to maintain a steady flow of insurance applicants, CREDIDIO also used some of the RAP proceeds to pay cash kickbacks ($50 to $300 per customer) to the car dealerships who referred her business.
In addition, CREDIDIO made various misrepresentations that harmed insurance carriers. For example, on some insurance applications, she falsely claimed that an applicant qualified for certain discounts—such as for defensive driving courses—when the applicant did not in fact qualify for those discounts. On other applications, she misrepresented the identity of the person operating the car, in order to conceal the fact that the true driver had a problematic driving history that would have led the insurance carrier to decline the policy or to charge a higher premium. For instance, CREDIDIO used the name of a relative (of the actual applicant), or a customer with an existing insurance policy who had no connection whatsoever to the policy being purchased.
After her arrest in this case, CREDIDIO’s misconduct in the car insurance industry persisted. While released on bail, she committed more than 215 (additional) instances of fraud and/or theft, which harmed at least two employers and various insurance applicants.
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In addition to her prison term, CREDIDIO, of Flushing, New York, was ordered to serve three years of supervised release. CREDIDIO was also ordered to pay $417,395.70 in restitution and to forfeit $197,400.
Mr. Berman praised the outstanding investigative efforts of the Federal Bureau of Investigation and the New York Automobile Insurance Plan.
The matter is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Michael D. Neff is in charge of the prosecution.
Jim Margolin, Nicholas Biase