A federal court in Illinois has sentenced the owner and CEO of a Hollywood, Fla.-based company to 25 years in prison for selling limited indemnity health plans as if they were full coverage plans using false and deceptive practices.
Simple Health sold misleading policies to more than 400,000 people nationwide from May 2012 through November 2018, generating more than $190 million in revenue.
In February, a jury convicted Steven Dorfman for conspiracy to commit mail and wire fraud through his company, Simple Health, the U.S. Attorney's Office for the Southern District of Illinois said July 25.
"He directed sales agents at his telemarketing company to lie to consumers and trick them into believing the limited indemnity insurance plans they were peddling would function like major medical insurance," said U.S. Attorney Rachelle Aud Crowe said. "This brazen fraud had lasting, and financially disastrous, effects on many victims"
In February, the FTC obtained a $195 million judgment in a Florida federal court against Simple Health and Mr. Dorfman. The judgment included a ban on marketing or selling any healthcare products in the future, liquidation of all Simple Health assets, and an order to turn over all proceeds to the FTC to provide refunds to consumers.