Insurance broker faces 20-year sentence

John W. Goff, owner of the Goff Group, may face at least 20 years in prison after his conviction yesterday on charges of mail fraud, embezzlement and filing false documents, according to the U.S. attorney’s office in Montgomery, Ala., where the now-defunct insurance brokerage firm was located.
Mr. Goff gave low-ball quotes to businesses to encourage them to take out workers’ compensation policies with him, authorities said. At the end of the one-year policy period, he gave the businesses a large invoice for an audit premium, which he pocketed.
In order to throw insurance companies off track, Mr. Goff told them that he was having trouble collecting the audit premiums and blamed the insurers for causing a problem with the audits. Then, after claiming financial difficulty, he would take the insurers to court and reach fraudulent settlements, authorities said. Mr. Goff pocketed $8 million through this practice, they said.
He also kept the commissions that he was supposed to pay to the independent insurance agents who gave him access to the businesses in the first place.
He also didn’t tell the agents or the insured businesses that he was keeping the premiums he collected on their behalf instead of sending them to the insurance company. Mr. Goff withheld some $4 million in premiums from Greenwich Insurance Co. and XL Specialty Insurance, both of Stamford, Conn.
He used the misappropriated cash to cover his $1 million annual salary, his private jet, his $1.2 million estate, his homes on the Gulf Coast and his country club memberships, according to authorities.
A federal court jury found Mr. Goff guilty of 23 counts of mail fraud, one count of embezzlement and one count of filing a false report with the Alabama Department of Insurance. He faces 20 years in prison for each of those counts, and 10 years combined on the other charges.
Mr. Goff has had run-ins with the authorities before. Just last year, the Massachusetts Division of Insurance sought to have all of his insurance licenses revoked and ordered him to cease doing business after he failed to notify the department in a timely manner that he had administrative actions against him in other jurisdictions.
In 2004, the Alabama insurance department accused Mr. Goff of collecting more than $800,000 from customers and agents, but failing to paying insurers.
His license has been revoked in Virginia, Indiana, Iowa, Alabama and New York.