Fraudster’s Suit Fails and Defendant Stays in Jail
Posted on July 29, 2026 by Barry Zalma
It is Fraud to Sell Product Using Scripts Containing Half-Truths and Omissions
That Made the Plans They Sold Appear to Provide Broader Coverage Than They Actually Did.
Post 5413
n United States of America v. Steven Dorfman, No. 24-2275, United States Court of Appeals, Seventh Circuit (July 27, 2026) Steven Dorfman owned and served as CEO of Simple Health, a telemarketing company that sold limited indemnity healthcare plans by telephone. The government alleged that Dorfman and other executives directed sales employees to use scripts containing half-truths and omissions that made the plans appear to provide broader coverage than they actually did.
A jury convicted Dorfman of conspiracy to commit fraud, wire fraud, and mail fraud, and he appealed after the district court denied his post-trial motions.
BACKGROUND
Limited indemnity plans are designed to supplement — not replace — traditional forms of medical insurance. As a result, they differ from traditional plans in several significant ways. Unlike traditional plans, for example, limited indemnity plans pay only fixed amounts when an insured incurs certain health expenses, and they are not legally mandated to cover prescription drugs or any specific types of treatment.
Perhaps most significantly, limited indemnity plans do not provide a ceiling on a plan holder’s out-of-pocket costs. As a result, the customer bears the risk of large medical bills (beyond the fixed amount provided by the plan). These plans are not governed by the Affordable Care Act (“ACA”) and do not satisfy the ACA’s individual mandate.
Dorfman himself had been told many times by Girouard that the sales scripts elided material facts, such as the plan’s lack of an out-of-pocket maximum. And he was aware of HII’s objection to the claim that the plans would save customers “up to 70%.” Moreover, Dorfman had the final say over the script’s content and knew that, when HII representatives came to Simple Health, they were shown an HII-approved script that was different from the one that Dorfman had approved for use.
JURY INSTRUCTION ON “SCHEME TO DEFRAUD”
Dorfman challenged the district court’s instruction defining “scheme to defraud” for the jury. The government asked the district court for a jury instruction similar to one found in United States v. Woods, 335 F.3d 993, 997-98 (9th Cir. 2003). The district court agreed and defined “scheme to defraud” as follows: In determining whether a scheme to defraud exists, you are entitled to consider not only the defendants’ words and statements, but also the circumstances in which they are used as a whole.
LAW:
The mail and wire fraud statutes prohibit schemes to obtain money or property by means of false or fraudulent pretenses, representations, or promises. The court held that the statutes do not require an expressly false statement; misleading half-truths, omissions, and deceptive statements may be sufficient when material and made with intent to defraud.
ANALYSIS/DISCUSSION:
The Seventh Circuit rejected Dorfman’s challenge to the “scheme to defraud” instruction, concluding that the instruction properly allowed the jury to consider misleading statements, omissions, and the surrounding circumstances. The court also found no reversible error in the jury’s receipt of Exhibit 10, a training video that had been admitted into evidence but not shown during trial; even assuming error, Dorfman failed to show a reasonable probability that it affected the verdict.
Finally, the court rejected Dorfman’s constructive-amendment and unanimity arguments, reasoning that evidence about concealment from HII, regulators, and the Better Business Bureau was used to show knowledge and intent, not to prove a separate fraud scheme.
CONCLUSION:
The court affirmed the judgment. It held that the jury instructions, evidentiary rulings, and absence of a specific unanimity instruction did not constitute reversible error, and that the evidence supported the jury’s finding that Dorfman knowingly participated in a fraudulent scheme targeting customers.
Accordingly, the district court’s instruction that even if statements as part of the scheme are not literally false, you may consider whether the statements taken as a whole were misleading and deceptive is a correct recitation of the law.
Simply put, Dorfman’s argument that the government pursued a fraud theory different from what the indictment described finds no support in the record. And it follows from this that a specific unanimity instruction was unnecessary.
ZALMA OPINION
People who commit insurance fraud, are caught, arrested, tried and convicted do not take their failure appropriately – they believe they have a right to steal from victims and make their crimes successful. They don’t but they litigate every possible issue to reverse their conviction and sentence. Most times, like this one, the attempt fails. Hopefully with the US DOJ’s new instructions from the White House more will be caught, tried, and convicted.
(c) 2026 Barry Zalma & ClaimSchool, Inc.
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Insurance Expert May Not Testify to Speculative and Contains Unsupported Conclusions.
Posted on September 18, 2026 by Barry Zalma
See the full video at and at https://rumble.com/v7fmifw-expert-may-only-testify-to-what-experience-supports.html
In Michele A. Over, and The Estate Of Paul R. Over v. State Farm Mutual Automobile Insurance Company, and State Farm Fire And Casualty Company, Civil Action No. 23-cv-02243-PAB-STV, United States District Court, D. Colorado (September 14, 2026) Michele and Paul Over sued State Farm Fire and State Farm Auto over hail-damage and stolen-vehicle claims.
The operative dispute concerned State Farm Auto’s motion to exclude or limit opinions from plaintiffs’ insurance-industry expert, Aaron Castillo. Castillo.
Law
The proponent of expert testimony must establish by a preponderance of the evidence that an expert is qualified and that the opinions are helpful, sufficiently grounded, and reliably derived and applied. Experience-based opinions must explain how the...
150 Months in Prison for Tax Fraud
Post 4846
Posted on September 17, 2026 by Barry Zalma
See the full video at https://lnkd.in/g8rh3JBX and https://lnkd.in/gmkdy-9C, In United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
In United States Of America v. Thomas Addaquay, United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
Thomas Addaquay controlled United Consolidated Accounting and Business Services (UC), nominally a check-cashing business.
The government proved a three-stage tax-refund scheme that converted the resulting refund checks into usable funds through ...
Major Fraud Perpetrator Asserts Fifth Amendment Privilege to Avoid Prosecution
Post 5489
Posted on September 14, 2026 by Barry Zalma
Fraudster Refuses to Answer Questions About His Alleged Fraud
See the full video at https://lnkd.in/gvicAMDr and at https://lnkd.in/gvicAMDr
In Great American Insurance Co. v. Gemstone Property Management, LLC, et al., No. 23-cv-9100 (LJL), United States District Court, S.D. New York (September 8, 2026) Great American Insurance Company alleged that it was defrauded through a scheme in which Subin Associates, LLP recruited individuals to stage construction-site injuries, arranged unnecessary medical treatment and litigation funding, and pursued fraudulent personal-injury claims.
Luis Manuel Garcia Salcedo, resulted in a $6 million settlement. Non-party Jose Hernandez allegedly worked as an assistant manager at Subin, operated Hernandez Associates, and owned litigation-funding companies that shared office space with Subin and provided services to its clients.
After Great American ...
Kindness in Sentencing is Often Abused and Probation Becomes Jail
Posted on September 21, 2026 by Barry Zalma
Post 4848
See the full video at and at at https://lnkd.in/gGJpiN_R and at https://lnkd.in/gb56mYsP
In State Of North Carolina v. Tia Allen, No. COA24-1010, Court of Appeals of North Carolina (September 16, 2026) Tia M. Allen pleaded guilty on 18 April 2022 to several offenses under a plea agreement.
On 6 February 2024, her probation officer alleged that Allen had paid nothing, failed to report, and incurred new criminal charges.
The court found all alleged violations, extended probation by 24 months, imposed five months’ confinement as special probation, required reporting after release, and ordered electronic house arrest.
LAW
A probation violation need not be proved beyond a reasonable doubt; competent evidence must reasonably satisfy the trial judge that the defendant willfully violated a valid probation condition.
An in-court admission of a willful violation eliminates the need for ...
Kindness in Sentencing is Often Abused and Probation Becomes Jail
Posted on September 21, 2026 by Barry Zalma
Post 4848
See the full video at and at at https://lnkd.in/gGJpiN_R and at https://lnkd.in/gb56mYsP
In State Of North Carolina v. Tia Allen, No. COA24-1010, Court of Appeals of North Carolina (September 16, 2026) Tia M. Allen pleaded guilty on 18 April 2022 to several offenses under a plea agreement.
On 6 February 2024, her probation officer alleged that Allen had paid nothing, failed to report, and incurred new criminal charges.
The court found all alleged violations, extended probation by 24 months, imposed five months’ confinement as special probation, required reporting after release, and ordered electronic house arrest.
LAW
A probation violation need not be proved beyond a reasonable doubt; competent evidence must reasonably satisfy the trial judge that the defendant willfully violated a valid probation condition.
An in-court admission of a willful violation eliminates the need for...
Kindness in Sentencing is Often Abused and Probation Becomes Jail
Posted on September 21, 2026 by Barry Zalma
Post 4848
See the full video at and at
In State Of North Carolina v. Tia Allen, No. COA24-1010, Court of Appeals of North Carolina (September 16, 2026) Tia M. Allen pleaded guilty on 18 April 2022 to several offenses under a plea agreement. The trial court consolidated the convictions, imposed an 11-to-23-month sentence,
On 6 February 2024, her probation officer alleged that Allen had paid nothing, failed to report, and incurred new criminal charges. At the 26 March 2024 hearing, counsel admitted Allen’s nonpayment but did not admit commission of the new offenses; the court did not inquire into the failure-to-report allegation.
Defendant did not deny this probation violation. Instead, when the trial court asked whether Defendant wanted to admit any of the alleged probation violations, Defendant admitted her ...
