Unlicensed agent hit with suite of criminal charges
The woman, formerly of Orange County, pulled in more than $1 million from her worker’s comp fraud scheme.
Grand theft, forgery, embezzlement and aggravated white-collar crime are the charges Karyl Lynn Reed, who acted as an unlicensed insurance agent, is facing for a workers’ comp scam she ran from 2012-2019, according to the California Department of Insurance. Reed was arrested early this month in Texas and was extradited back to Orange County.
During the seven-year period, Reed acted without a license and collected premiums for workers’ comp insurance through her business, Envoy Business Partners and Allenn Specialty Group. Her victims were provided fraudulent certificates of insurance, leading them to believe they were covered when in fact they were not.
In addition to her bogus insurance business, Reed ran a staffing company that operated without valid workers’ comp coverage. She also personally adjusted and administered employee injury claims. Clients of the staffing agency were furnished with false certificates of insurance while Reed collected premiums and payroll as well as employer and employee taxes.
Reed’s action had real-world consequences, as the department’s investigation found one victim had no coverage when an employee became injured. Another company had requested an updated certificate of insurance only to find out no coverage existed and the policy number they were given came from another business’ insurance plan. A third victim learned the money they paid to Reed was never remitted to the insurance company, according to the California Department of Insurance.
“Local businesses are the lifeblood of our recovering economy. Ms. Reed’s alleged actions put these businesses owners’ livelihoods at risk by stealing their money and leaving them uninsured,” California Insurance Commissioner Ricardo Lara said in a release. “My department is dedicated to investigating and stopping unlicensed agents to protect California’s consumers and businesses who help keep our economy strong.”
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