Chutzpah: Serial Arsonist & Insurance Fraudster Requests Shortened Sentence
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Post 4827
Arson-for-Profit is the most evil form of insurance fraud where people may be injured or die. Defendant Michael Thomas set fire to many properties in a mobile home park and then used the mail to collect insurance money. He was charged with four counts of mail fraud, went to trial and the jury convicted him on all counts. The Court sentenced him to a below-guidelines sentence of ninety months of imprisonment. His sentence is set to expire on February 11, 2025. Mr. Thomas is currently under home confinement under the CARES Act.
In United States Of America v. Michael Thomas, No. 3:18-CR-45 JD, United States District Court, N.D. Indiana, South Bend Division (June 6, 2024) Proceeding pro se, Mr. Thomas moved for a reduction in his sentence and the court considered his claims and rejected them.
BACKGROUND
After serving time in prison, Mr. Thomas was released by the Bureau of Prisons (“BOP”) to home confinement under the CARES Act to finish the rest of his sentence, which is expected to end next February. Mr. Thomas claims that the BOP is prohibiting him from securing employment as a pilot, a job which he held before being convicted of the fraud offenses. He states that he needs this job to maximize his income in order to repay restitution, support his family, and repay student debts. Mr. Thomas insists that his inability to work because of home confinement constitutes atypical circumstances warranting compassionate release.
LEGAL STANDARD
A court generally cannot modify a sentence once the sentence has been imposed. An exception to that general rule allows a court to modify a sentence, after considering if “extraordinary and compelling reasons warrant such a reduction,” the reduction is consistent with policy statements issued by the Sentencing Commission.
This analysis proceeds in two steps. At the first step the defendant must identify an extraordinary and compelling reason warranting a sentence reduction. If the defendant establishes such a reason, the district court, in the discretion conferred by the statute. The defendant’s rehabilitation is not, by itself, an extraordinary and compelling reason.
DISCUSSION
For four years, Mr. Thomas was engaged in mail fraud schemes against insurance companies. As part of those schemes, he and an associate caused seven fires at various dwellings in North Judson, Indiana. After the fires, he filed for and collected insurance payments on four properties that were damaged or destroyed by these fires.
Of the seven fires, two of them were at vacant properties, set to deflect suspicion from Mr. Thomas’s insurance fraud. By setting fires to residences, Mr. Thomas displayed no regard for the welfare and safety of those who lived nearby. While the dwellings he burned may have been unoccupied, his actions put first responders directly in harm’s way and there was no guarantee that the fires would not spread to nearby, occupied homes. The nature of Mr. Thomas’s criminal conduct, the need to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense, as well as the importance of deterring insurance fraud – among other factors – outweigh any mitigating circumstances in favor of early release.
The court concluded that Mr. Thomas did not establish an extraordinary and compelling reason for modifying his sentence. That Mr. Thomas has a limited ability to do other jobs rather than his preferred one due to his home detention status does not convert his situation into an extraordinary one. There’s no compelling reason to modify his sentence.
Therefore, Mr. Thomas’ motion for compassionate release or reduction in sentence was denied.
ZALMA OPINION
A professional pilot acted as a serial arsonist and insurance fraudster. He was convicted of the violent and dangerous crime of arson for profit and served time. He was lucky and allowed to serve the remainder of his sentence at home and then, with unmitigated gall, complained that the home confinement prevented him from making more money as a pilot and asked for his sentence to be reduced. The Court had no empathy and required him to fulfill his entire sentence.
(c) 2024 Barry Zalma & ClaimSchool, Inc.
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Notice of Claim Later than 60 Days After Expiration is Too Late
Post 5089
Injury at Massage Causes Suit Against Therapist
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Hiscox Insurance Company (“Hiscox”) moved the USDC to Dismiss a suit for failure to state a claim because the insured reported its claim more than 60 days after expiration of the policy.
In Mluxe Williamsburg, LLC v. Hiscox Insurance Company, Inc., et al., No. 4:25-cv-00002, United States District Court, E.D. Missouri, Eastern Division (May 22, 2025) the trial court’s judgment was affirmed.
FACTUAL BACKGROUND
Plaintiff, the operator of a massage spa franchise, entered into a commercial insurance agreement with Hiscox that provided liability insurance coverage from July 25, 2019, to July 25, 2020. On or about June 03, 2019, a customer alleged that one of Plaintiff’s employees engaged in tortious ...
ZIFL – Volume 29, Issue 11
The Source for the Insurance Fraud Professional
Posted on June 2, 2025 by Barry Zalma
Post 5087
See the full video at and at
Read the full article and the full issue of ZIFL June 1, 2025 at https://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-06-01-2025.pdf
Zalma’s Insurance Fraud Letter – June 1, 2025
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ZIFL – Volume 29, Issue 11
The Source for the Insurance Fraud Professional
Read the full article and the full issue of ZIFL June 1, 2025 at https://lnkd.in/gTWZUnnF
Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at ...
No Coverage if Home Vacant for More Than 60 Days
Failure to Respond To Counterclaim is an Admission of All Allegations
Post 5085
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In Nationwide Mutual Insurance Company v. Rebecca Massey, Civil Action No. 2:25-cv-00124, United States District Court, S.D. West Virginia, Charleston Division (May 22, 2025) Defendant Nationwide Mutual Insurance Company's (“Nationwide”) motion for Default Judgment against Plaintiff Rebecca Massey (“Plaintiff”) for failure to respond to a counterclaim and because the claim was excluded by the policy.
BACKGROUND
On February 26, 2022, Plaintiff's home was destroyed by a fire. At the time of this accident, Plaintiff had a home insurance policy with Nationwide. Plaintiff reported the fire loss to Nationwide, which refused to pay for the damages under the policy because the home had been vacant for more than 60 days.
Plaintiff filed suit ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
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Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
Professional Health Care Services Exclusion Effective
Post 5073
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This opinion is the recommendation of a Magistrate Judge to the District Court Judge and involves Travelers Casualty Insurance Company and its duty to defend the New Mexico Bone and Joint Institute (NMBJI) and its physicians in a medical negligence lawsuit brought by Tervon Dorsey.
In Travelers Casualty Insurance Company Of America v. New Mexico Bone And Joint Institute, P.C.; American Foundation Of Lower Extremity Surgery And Research, Inc., a New Mexico Corporation; Riley Rampton, DPM; Loren K. Spencer, DPM; Tervon Dorsey, individually; Kimberly Dorsey, individually; and Kate Ferlic as Guardian Ad Litem for K.D. and J.D., minors, No. 2:24-cv-0027 MV/DLM, United States District Court, D. New Mexico (May 8, 2025) the Magistrate Judge Recommended:
Insurance Coverage Dispute:
Travelers issued a Commercial General Liability ...
A Heads I Win, Tails You Lose Story
Post 5062
Posted on April 30, 2025 by Barry Zalma
"This is a Fictionalized True Crime Story of Insurance Fraud that explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help everyone to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime."
Immigrant Criminals Attempt to Profit From Insurance Fraud
People who commit insurance fraud as a profession do so because it is easy. It requires no capital investment. The risk is low and the profits are high. The ease with which large amounts of money can be made from insurance fraud removes whatever moral hesitation might stop the perpetrator from committing the crime.
The temptation to do everything outside the law was the downfall of the brothers Karamazov. The brothers had escaped prison in the old Soviet Union by immigrating to the United...
