N.J. Resident, Former Agent Pleads Guilty to Fraud and Witness Tampering

New Jersey’s Acting Attorney General Peter Harvey announced that a Union County resident and former New Jersey-licensed agent has pled guilty to theft and related insurance fraud crimes for reportedly failing to remit insurance premiums to an insurance carrier after collecting the monies from insurance purchasers and clients.

According to Vaughn McKoy, Acting Director, Division of Criminal Justice and Insurance Fraud Prosecutor Greta Gooden Brown, Farid Elgebaly, Union County, pled guilty before Passaic County Superior Court Judge Randolph Subryan to charges of theft by deception (3rd degree), misapplication of entrusted property (3rd degree), and to four counts of simulating a motor vehicle insurance identification card (4th degree).

Elgebaly also pled guilty to a separate charge of witness tampering. A third degree crime carries a maximum sentence of up to five years in state prison and a fine of up to $15,000. A fourth degree crime carries a maximum penalty of up to 18 months in state prison and a fine of up to $15,000. Additionally, Elgebaly’s New Jersey insurance producers license was revoked in February, 2001, and the case will be referred to the Department of Banking and Insurance for appropriate regulatory review. Elgebaly is scheduled to appear before Judge Subryan on Sept. 12 for sentencing.

Elgebaly, a former insurance agent, was charged by the Division of Criminal Justice – Office of Insurance Fraud Prosecutor via a Passaic County Grand Jury indictment returned on March 12, 2002. At the guilty plea hearing, Elgebaly admitted that he accepted money from various individuals for automobile insurance premiums but reportedly failed to remit the money to the New Jersey Personal Automobile Insurance Plan (PAIP) or to secure automobile insurance for the individuals who paid the premium monies. Elgebaly also admitted that he obtained and distributed fraudulent insurance identification cards to some of his clients.

The Office of Insurance Fraud Prosecutor’s investigation determined that on May 22, while the case was being prepared for trial, Elgebaly and an alleged accomplice delivered a check in the amount of $265 to a witness who was scheduled to testify against him at trial. The money was intended to convince the witness to drop the charges and to not testify.

At the guilty plea hearing, Elgebaly admitted that he attempted to tamper with the witness to prevent the witness from testifying. The co-defendant was arrested and charged by state investigators from the Division of Criminal Justice – Office of Insurance Fraud Prosecutor with witness tampering. The case is pending.