Florida insurance broker admits guilt in 3 million healthcare enrollment fraud case.

A vice president of an insurance brokerage firm, along with his associates, has been implicated in a scheme aimed at exploiting vulnerable populations, including the homeless, unemployed, and individuals with mental health and substance abuse issues. The U.S. Department of Justice reported that these actions were undertaken to secure commissions from fraudulent enrollments in the Affordable Care Act (ACA).

According to federal officials, the scheme involved submitting false applications for health insurance plans, targeting individuals ineligible for the subsidies that are accessible through the federal marketplace. As a result of these fraudulent activities, the government disbursed approximately 3 million in subsidies for individuals who had been improperly enrolled, as outlined in a recent press release from the DOJ.

Dafud Iza, 54, from Pembroke Pines, Florida, has pleaded guilty to one count of major fraud against the United States. He faces a potential maximum penalty of ten years in prison, although sentencing has yet to take place. The specific name of Iza’s brokerage firm has not been disclosed in court records; however, it has been noted that he served as an executive at Fiorella Insurance Agency in Stuart, Florida, up until 2024, based on his publicly viewable professional profile.

Investigations have revealed that hundreds of homeless individuals in Florida may have been coerced into enrolling in zero-premium health plans through the ACA marketplace by agents and brokers motivated by commissions. A significant concern is that these policies frequently included copayments, deductibles, and other out-of-pocket expenses that the enrollees were unable to afford.

Katie Roders Turner, executive director of the Family Healthcare Foundation, a nonprofit based in Tampa, stated that the type of fraud highlighted has impeded access to necessary medical care for the most vulnerable populations. This exploitation has led many individuals to become ineligible for community safety-net programs vital to their health and well-being.

The fraudulent scheme reportedly included “street marketers” who engaged in bribing individuals to enroll in subsidized health plans. These marketers instructed enrollees on submitting applications designed to maximize government subsidies and provided fictitious addresses and social security numbers to obfuscate the true identity of the applicants.

In light of the fraud, navigators from the Covering Florida Navigator program have been assisting those affected by submitting appeals to the federal health insurance marketplace to rectify the fraudulent enrollments. Program director Xonjenese Jacobs emphasized the ongoing efforts to support these individuals.

Iza has since referred inquiries for comment to his attorney, David Joffe, who indicated that the decision to plead guilty was in Iza’s best interest and that he has accepted responsibility for his actions. The case underscores ongoing challenges related to fraudulent practices within health insurance markets, particularly impacting the nation’s most vulnerable populations.