Michigan regulators are cautioning drivers about an unlicensed agent and firm that sold policies in Detroit’s Southfield neighborhood, according to a statement from the Office of Financial Insurance Regulation (OFIR) issued Monday.
An enforcement inquiry launched by OFIR found that Shaker Uddin Sadeak used Al Baraka Enterprise to sell “bogus certificates purporting to have coverage through a legitimate insurance company,” according to the OFIR, which said that a coverage certificate containing various inconsistencies and misspellings spurred a local motorist who had bought a policy from Sadeak to contact investigators.
Jason Moon, an OFIR spokesman, told Online Auto Insurance News that eventually “several consumers brought complaints to our attention” about Sadeak but that the OFIR still believes “that there are more out there.” He declined to specify the number of cases.
OFIR commissioner Kevin Clinton said that drivers should check on their past policy purchases, adding that those who were issued auto policies from Sadeak and Al Baraka need “to buy legitimate coverage immediately.”
“Right now they’re driving without insurance,” Clinton said in a statement.
OFIR officials issued a cease-and-desist order in late October to Sadeak and Al Baraka, saying that the he had “issued certificates of insurance in exchange for cash” but “lacked the required competency, skill or education required” to conduct licensed business. Despite lacking a license, Sadeak and the agency “held themselves out to the public as being capable of doing so,” the order stated.
Investigators link Sadeak and Al Baraka’s “wrongful and unlawful conduct” to at least one consumer’s monetary losses.
The OFIR said that motorists who think they may have had dealings with Sadeak and Al Baraka should call 877-999-6442 to contact investigators, who can help verify whether or not their policy is legitimate. The phone number is toll-free.
Not only are all agents and agencies in Michigan required to be licensed, but relevant licenses must be displayed in their offices or on hand if asked to produce a copy.
Regulators said that, to protect themselves, consumers should make pre-purchase requests to view licenses or reference prospective insurers and agents with OFIR listings of licensed businesses. The department also offers this guide for consumers looking for a capable agent to help them in their search for low Michigan auto insurance rates.
The OFIR stated that it has sent copies of the enforcement case to relevant law enforcement agencies.
Looking up licenses will not always identify unscrupulous businesses, however. In May of last year, state regulators issued a similar warning to Detroit-area drivers about policies illegally sold by Ethos Insurance. That investigation found that, although Ethos carried a license, the agency sold bogus policies under the guise that they were backed by a legitimate insurer.