HomeHealthHealth CareEx-Dumas Insurance Agent Faces 52 Felony Counts | Arkansas Business News

Ex-Dumas Insurance Agent Faces 52 Felony Counts | Arkansas Business News

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A former Dumas insurance agent faces 52 felony charges in Desha County Circuit Court, charged with withholding premium money customers paid for policies that never existed.

Joshua Jackson Smith, 40, was charged Oct. 5 with 49 counts of fraudulent insurance law, including selling insurance without a license and issuing counterfeit insurance identification cards; two counts of property theft; and one count of second degree forgery.

Smith worked as an agent for Desha Insurance Inc., also known as First Arkansas Insurance or Dumas. Desha Insurance was operated by Smith’s father, David A. Smith, who has not been charged.

Desha Insurance closed its office in mid-September after selling its assets to Everett Cash Mutual Insurance Co. of Everett, Pennsylvania, according to the Arkansas Insurance Department.

Prosecutors say the charges against Josh Smith involve five victims, all farmers, though not all charges apply to every victim.

More: Tips to avoid premium diversion schemes.

In one instance, Danny Day Jr. and his son, C. Bradley Day, both of Desha County, in 2020 an insurance policy from Smith covering the farms, according to a report by James Kulesa, a researcher with the Arkansas Insurance Department. which was filed in Smith’s criminal case.

Between July 2020 and March 2021, the Days paid Smith nearly $100,000 in premiums on their policies, the prosecution says.

But when the Days filed five claims totaling about $60,000, the claims were not honored, Kulesa said, “In addition, they have two pending lawsuits that should have been covered by the policy had it existed,” Kulesa wrote.

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Smith also provided Danny Day with two receipts for a tractor and trailer, but they were bogus, Kulesa wrote.

Kulesa said he interviewed Smith in November 2021. “During the interview, Smith admitted that he accepted insurance premiums from Danny Day when there was no insurance policy.

“Smith admitted that the insurance identification cards he issued to Danny Day were fraudulent.”

Smith did not answer messages from Arkansas Business left on his cell phone. He pleaded not guilty to the charges on November 7. Smith’s criminal defense attorney, Matthew Flemister of Nelson & Marks of Bentonville, did not call for comment.

But court documents provide a glimpse into the legal issues surrounding Josh Smith.

He started working for Desha Insurance in 2011 and earned $40,000 in 2017 and 2018, according to his bankruptcy filing.

In March 2019, Smith was due to renew his insurance license, but did not, Kulesa wrote. And without a valid license, he was not legally allowed to sell insurance.

Couple File for Bankruptcy

Meanwhile, Smith was having financial problems. In October 2019, Smith and his wife, Laura Brooke Smith, filed for Chapter 13 bankruptcy reorganization.

The couple listed $182,500 in assets and $210,700 in debt, with $100,000 in debt arising from student loans.

Shortly after the bankruptcy filing, allegations of misconduct surfaced in his handling of insurance policies.

Freddie Bartlett of Dumas thought he bought insurance from Smith in November 2020 for his farm and equipment.

After one of Bartlett’s buildings collapsed during a winter blizzard, he filed claims through Smith for about $100,000. But the receivables were never paid.

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“I would keep asking why we haven’t been paid,” Bartlett told Arkansas Business. “He always had an excuse.”

Finally, Bartlett contacted the insurance department. “It wasn’t about the money at the time,” he said.

In December 2021, Arkansas Insurance Commissioner Alan McClain issued a cease and desist order against Smith to stop him from selling insurance.

Smith “was posing as an active, licensed insurance producer,” when he was not, McClain wrote in the order.

Meanwhile, the Days also had problems with Smith.

In November 2021, the Days filed a lawsuit against Smith, his father, David Smith, and Desha Insurance, seeking damages and alleging breach of contract and breach of fiduciary duty. The defendants have denied the allegations of wrongdoing.

The criminal file stated that the Dagen had received two certificates of insurance. But one was found to have an invalid policy number, according to the report from Kulesa, the detective. The other had a valid policy number, but was in a different state for a different policyholder.

In a November 18, 2022 affidavit filed in the civil suit, David Smith said he learned through discovery that there were insurance cards “that appear to have come from Joshua Smith’s computer.”

David Smith said his son “was not authorized to do this, and the information on those cards is not correct.”

The civil case is pending.

Josh Smith was arrested on October 7 and released on $50,000 bail.

Smith’s jury trial begins April 4 in Desha County courtroom before Circuit Judge Robert Gibson III.

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