The state has stripped a Newport Center man of his insurance license, alleging he lied to clients about signing them up for policies and filing claims they requested, falsified records and led people to believe they were insured when they were not.
Benjamin Scherer, who worked at the Royer Camp insurance agency in Newport, lost his license Nov. 3, pending a further state investigation.
Scherer “engaged in a series of fraudulent, coercive and dishonest practices over the past two years in his capacity as an insurance producer,” Michael Pieciak, commissioner of the Department of Financial Regulation, wrote in an order suspending the license.
Scherer’s former employer reported irregularities to the state. He resigned from the insurance agency in October, according to the state order, issuing an apologetic email to a boss in which he admitted lying.
On Thursday, no one answered a phone number listed online as Scherer’s. A person who answered another phone number listed as Scherer’s declined comment and said they were “not at liberty” to describe their relation to Scherer.
The state order, announced in a press release Wednesday, outlines how officials say Scherer deceived both his clients and his company.
In May 2019, a married couple who were clients of Scherer’s purchased a farm, according to the state.
In September of that year, Scherer told the couple he would buy a commercial insurance policy to cover their farm and would cancel an existing homeowners policy they held but no longer needed, records show.
The next month, when the couple began leasing a barn on another person’s property, the couple asked Scherer via email if they had insurance coverage, records show. They needed to provide the barn owner with a copy of the insurance policy.
“You are covered, I promise,” Scherer wrote in response, according to the state.
In April 2020, the couple emailed Scherer to say they had received a renewal notice for the homeowners policy that was supposed to have been canceled, records show.
Scherer replied that the policy had been “canceled at one point” and he would look into the matter, according to the state. He told the client he wasn’t sure if the couple had received a refund for that homeowners policy, and if they had, it had likely been applied to their commercial policy, so they didn’t get a bill, the state order says.
In a later April email, according to the state, Scherer told the client that a $350 refund check had been issued for the homeowners policy and applied to the couple’s balance on the commercial policy. He said he had waived his commission fee, too, according to the state.
But sometime after June 4, Scherer’s employer received a notice of cancellation for the couple’s homeowners policy for nonpayment — it had never been canceled, according to the state.
And the commercial insurance provider said it had not received any application for a policy for the clients, according to the state, so the couple had never been issued a policy.
Royer Camp files contain three documents “apparently falsified” by Scherer to show the clients had a commercial policy, according to the state.
In December 2019, another client asked Scherer to file a claim with an insurance company because her garage had a collapsing foundation wall, according to the state document.
In February of this year, the client asked Scherer for news about an appraisal on the garage, the state says. Scherer told her he hadn’t heard anything from the insurance adjuster and would check on the status of the client’s claim, records show.
A day later, Scherer told the client that her insurance company had denied the claim and would be sending a letter and report about the denial, according to the state. But about a week later, the client told Scherer that she had received nothing, records show.
In August, the client asked Scherer what was going on with her claim. According to the state, she told Scherer that her garage was becoming less stable and she was concerned about the lack of a settlement as the winter approached.
Scherer replied that he had time available “to come out and meet you this coming week with (the) adjuster,” according to the state. But Scherer had never filed the client’s insurance claim, the state says.
The state order also says that between June and September of this year, Scherer had manually falsified the expiration dates of three clients’ policies and extended their policies beyond their correct expiration dates.
Those policies “were not timely renewed or replaced by” Scherer, according to the state, “despite the clients’ wishes to either renew their policies or obtain new policies.”
Last month, Scherer’s bosses asked to meet with him over apparent irregularities in a client account. But before the meeting, Scherer emailed a resignation, according to the state, saying he was “deeply sorry for losing your trust” and “it is not fair to continually drag you on, while lying, and trying to cover my steps of mistakes that I’ve made as I go.”
In a statement, the Royer Camp insurance agency said its management is “shocked and dismayed to learn that one of our employees engaged in serious misconduct which may have impacted some of our customers.”
The agency said it has arranged an audit of customer files to figure out if any other customers were affected by Scherer’s alleged misconduct, and to rectify the problems.
Pieciak, the financial regulation commissioner, told VTDigger that “former clients with insurance policies will not be impacted by the suspension.”
