Five Murphy Village Irish travelers sued over insurance fraud scheme
Sep. 13—Five Irish travelers in North Augusta's Murphy Village have been sued over an insurance fraud scheme that led to more than 50 guilty pleas in 2017.
American National Insurance Company filed suit in federal district court (Aiken division) on Sept. 9 against Susan Gorman, Mary McNally, Mary Harrison, Jude Sherlock and Cathy Sherlock over life insurance policies obtained in 2013 as part of a conspiracy to violate South Carolina's laws against wagering contracts.
The suit accuses Gorman of requesting that two people complete an application for a life insurance policy for one of the two people. In the application, the person's annual income, net worth, employment status and health status were misrepresented. Initially, the beneficiary of the policy was listed as one of the insured person's grandchildren.
The company then approved the policy based on the misrepresentations.
From when the policy was approved, Gorman and another female paid the insurance premiums despite not being the beneficiary of the policy or its owner at the time.
On March 4, 2014, at Gorman's request, the people who applied for the policy changed the beneficiary to Gorman and two other women, falsely identifying Gorman and one of the women as the insured person's nieces. On March 7, 2014, at Gorman's request, the mailing address of the insured person was changed to Gorman's address.
The suit alleges that the changes were made to evade South Carolina's law against wagering contracts that requires a person seeking an insurance policy on someone else to have an insurable interest (i.e., be related to) the person who's insured.
The allegations against the others are similar to the allegations made against Gorman, only the dates change.
The Texas-based insurance company asks the court to declare the two policies unenforceable and void due to violations of South Carolina, the Racketeering and Corrupt Organizations (RICO) Act and fraud committed.
American National asks the court to award exemplary damages, reasonable and necessary attorney's fees and pre- and post-judgment interest.
None of the defendants have yet responded to the suits.
