Mich. Car Dealership Ordered to Stop Unlicensed Insurance Sales

Dozens of consumers were the victim of phony sales of vehicle coverage policies at a Detroit-area car dealership, according to Michigan regulators.

The Department of Insurance and Financial Services (DIFS) issued a cease-and-desist order on Tuesday to Camillo Anthony Monaco and Darrell Lees of Monaco Motors. According to the department, consumers bought cars after being told that the purchase would be “in conjunction with” no-fault insurance for the new vehicle while the dealership, Monaco and Lees were all unlicensed to conduct such business.

A Case in Detail

According to the cease-and-desist order, investigators say that they found a range of details in the case showing that Monaco Motors was involved in coverage-related transactions they were unlicensed to conduct.

Paperwork dated between Oct. 11, 2012, and Jan. 3, 2013, showed that at least 15 consumers bought cars from the dealership that listed GEICO as the insurer providing their no-fault policies, according to the DIFS.

But that paperwork, which was submitted to Michigan’s Secretary of State, contained several inconsistencies pointing to the dealership as the purchaser of the policies. Thirteen of the 15 policies for those consumers were bought online from the same IP address, according to investigators, with 10 of those 13 listing the same email address and four of those 10 using the same credit card.

Also, 12 of the policy applications listed the fax number investigators confirm to be the fax number at Monaco Motors.

Fifteen other consumers bought cars from Monaco Motors between Sept. 21, 2012, and Jan. 23, 2013, with those vehicles listed with no-fault policies from Progressive. Nine of those 15 Progressive policies were bought online with the same credit card, though all were cancelled later because of credit card fraud, according to the DIFS.

According to audio from Progressive’s Special Investigations Unit case on Monaco Motors, DIFS said, a consumer told an investigator that he paid “Tony” at the dealership $700 in cash for a car with the promise that “Monaco Motors would get insurance for him.”

Investigators from the DIFS believe that “Tony” described by the customer is Monaco at the dealership, according to the cease-and-desist order.

The Michigan Department of State sent more details about Monaco Motors to investigators, according to the DIFS cease-and-desist order.

According to staff, the dealership issued “Certificates of Insurance” under “borrower’s insurance” sales with Knightbrook Insurance Company listed as the insurer.

Customers would be told that the certificate sufficed as proper coverage for the driver, but certificates for borrower’s coverage in fact “protects the interests of the lender and not the interest of the customer,” according to the DIFS.

Customers would find that their policy was invalid during the registration process with the Secretary of State Office, the department said.

Don’t Be a Victim

Michigan regulators have seen other cases involving licenseless sales of auto coverage. The latest case was in January, when investigators identified Mervin Graber and Tennessee Christian Motorist Aid as selling policies without a proper license. Also, Shaker Uddin Sadeak and Al Baraka Enterprise were named in a case from last November.

According to the DIFS, any person or agency selling valid car coverage is required to display their license to sell auto coverage in Michigan, and consumers should ask for it whenever they conduct business. Numbers and names on that license can be cross-referenced at the department’s website.

A walkthrough from Online Auto Insurance shows consumers how to research whether or not they are buying from a licensed agent or company.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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