Ex-insurance salesman facing theft, fraud charges
A former Farmer’s Insurance agent is facing more than 240 criminal counts for allegedly pocketing or mishandling thousands of dollars’ worth of client funds, according to an affidavit of probable cause for his arrest filed by Detective Lt. Charles Palo Jr.
Nicholas J. Palladino, 38, of the 300 block of Harding Avenue in Milmont Park, is charged with 27 counts each of theft by unlawful taking, receiving stolen property, theft by deception, fraudulent destruction of recordable instruments, forgery, deceptive or fraudulent business practices, misapplication of entrusted property to financial institutions, securing execution documents by deception and insurance fraud. Nearly all of the charges are felonies.
Palladino could not be reached for comment at a listed home number Monday and it was unclear if he has an attorney. Calls to his office on the 500 block of Kedron Avenue in Folsom were not picked up.
Palladino joined Farmer’s in 2012, according to the affidavit. The insurance company initiated an investigation into Palladino’s “questionable handling (of) insurance premium practices” in July 2017, the affidavit states.
Palladino was interviewed by Farmer’s Senior Investigator Marletta Wilmarth in August 2017, but was unable to account for $8,533 in premium collections, according to the affidavit.
The affidavit states that Palladino did pay back those funds between August and September of 2017, but provided falsified bank statements when he was asked to provide copies of his personal bank statements to validate the amounts of premiums going through his personal checking account, according to the affidavit.
Palladino’s agent appointment agreement was terminated by Farmer’s March 2 due to embezzlement, the affidavit states. Following his termination, 27 insureds provided proof of premium payments totaling $19,327 that were made to Palladino and handled improperly, according to the affidavit.
Palo notes that agents are authorized to collect premiums on behalf of Farmers and are required to input the payment information into an online accounting system, which produces a receipt to be given to the insured. All payments put into the system are applied to the indicated policies and the agent is required to deposit the premium into a company-owned bank account.
The internal audit team is notified if the premium is not deposited or if an agent submits their own check that is returned for insufficient funds.
The affidavit lays out four methods of fraud Palladino allegedly engaged in:
For 13 payments totaling $9,731, he allegedly applied the checks to the policies but deposited the funds into his own personal checking account rather than the company account.
For eight payments totaling $5,912, Palladino did not receipt the payments so the insureds did not receive the appropriate credits to their policies, according to the affidavit. Those funds were also allegedly deposited into his personal account.
Palladino also allegedly receipted six check premium payments for amounts that were less than the payments given to him, so the insureds did not receive full policy credits. The funds, totaling $2,754, were not deposited into a company-owned account, but into Palladino’s personal checking account, according to the affidavit.
The affidavit indicates Palladino also received and then voided one check for $929 so the insured did not receive credit on the policy. He then deposited that check into his personal account, according to the affidavit.
Palladino was preliminarily arraigned before Magisterial District Judge James Merkins Aug. 9 and bail was set at 10 percent of $25,000. Court records do not indicate bail had been posted as of Monday. A preliminary hearing before Magisterial District Judge Vincent Gallagher Jr. is scheduled for Sept. 17.