An insurance broker and his company have had their licenses to sell insurance revoked and were fined $1.16 million following a Connecticut Insurance Department (CID) investigation into the misappropriation of a client’s funds. Insurance Commissioner Andrew N. Mais announced the actions against insurance producer John “Jack” Michael Horvath and his company, the Insurance Education Center Agency LLC (IECA).
In 2014, the client engaged Horvath and IECA to help manage a $2.2 million estate. After serving as the client’s agent in connection with purchasing two annuities in 2016, totaling approximately $1.7 million, Horvath assisted the client with withdrawals and mishandled those funds. Of the amounts withdrawn, the client provided Horvath and IECA with $864,500 for investment purposes. After an investigation and a hearing, CID determined that Horvath and IECA misappropriated $809,500 of those funds.
Commissioner Mais ordered the revocation of the insurance producer licenses issued to Horvath and IECA and that they pay civil penalties totaling $1.16 million. To address the harm sustained by the client, for every dollar Horvath and IECA pays in restitution to the client, the CID will allow for a two-dollar credit reducing the amount of the aggregate penalty.
“Over five years, Horvath methodically stole more than $800,000 from his client,” said Commissioner Mais. “Horvath abused a position of power and took advantage of a senior citizen. The CID’s core mission is consumer protection, and we work tirelessly to address abuses of power as we found here.”
SOURCE: State of Connecticut Insurance Department
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