For Immediate Release: January 19, 2012
Huntersville Restaurant Owner Accused of Illegally Cancelling Health Insurance Policy
RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest of Joseph Michael Phelan, 42, of 9702 Aegean Court, Huntersville; he is charged with one count of willful failure to pay group health insurance premiums.
Investigators allege that Phelan, owner of Friendly’s Restaurant in Huntersville, cancelled an employee’s health insurance policy without giving the notice required by law and continued to take premiums from the victim’s paycheck after the policy was cancelled. The Mecklenburg County District Attorney’s Office is seeking restitution for the victim in the amount of $2,128.98 for the misappropriated premiums and medical bills incurred by the victim while uninsured.
Phelan was arrested on Jan. 18 with the assistance of Huntersville Police Department and was released on a written promise to return to Mecklenburg County Court.
The Department of Insurance employs 20 sworn state law enforcement officers dedicated to investigating and prosecuting claims of insurance and bail bonding fraud. Since Insurance Commissioner Wayne Goodwin took office in 2008, criminal investigators have received more than 13,500 complaints, resulting in 575 arrests, 320 criminal convictions, and more than 109 cases currently pending a court appearance. These arrests have resulted in more than $47.9 million in restitution and recoveries for victims.
An estimated 10 cents of every dollar paid in premiums goes toward the payment of fraudulent claims. To report suspected fraud, contact the Department of Insurance Criminal Investigations Division at 919-807-6840. Callers may remain anonymous. Information is also available at the Web site for the N.C. Dept. of Insurance.