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Frank Pescatore, 73, and his son, former life insurance agent Evan Pescatore, 38, of Highlands finagled 18 policies with a combined face value of $61.5 million from eight insurance companies by paying the premiums, state Attorney General Gurbir S. Grewal said Wednesday.
The process of providing applicants and insureds with a no-cost inducement to apply for life insurance policies by paying their premiums is known as “rebating” -- and is prohibited by the insurance industry, as well as by New Jersey law, Grewal said.
The policies, which shouldn’t have been issued, lapsed prematurely, the attorney general said.
Rather than go to trial, both men took deals from the government and pleaded guilty to insurance fraud in December.
Superior Court Judge Lourdes Lucas, sitting in Freehold, sentenced them on Monday.
The FBI puts the total cost of non-medical insurance fraud at more than $40 billion annually, costing the average U.S. family between $400 and $700 a year in the form of increased premiums, Acting Insurance Fraud Prosecutor Tracy M. Thompson said.
“These crimes affect every policy holder,” Thompson said.
Deputy Attorney General Jennifer L. Menjivar represented the State at sentencing. Detectives Natalie Brotherston, Taryn Seidner, and Matthew Armstrong coordinated the investigation with assistance from analyst Kelly Celenza, Grewal said.
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