Insurance agency owner charged with 15 felonies

ROOSEVELT — He's seen two of his agents plead guilty to felony charges related to criminal activity at his Vernal insurance agency, now Philip J. Timothy is facing charges of his own.

The 56-year-old was charged Thursday by the Utah Attorney General's Office in 3rd District Court with 15 felonies. The charges against the majority-owner of Service Insurance Agency of Vernal include one count each of racketeering, conspiracy, and obstruction of justice; two counts each of filing a false or fraudulent insurance claim, forgery, and communications fraud; and three counts each of unlawful dealing with property by a fiduciary and theft by deception.

In court records, state investigators claim that Timothy used insurance premium refunds owed to clients to buy two trailers totaling more than $20,000 and a Harley-Davidson motorcycle worth over $30,000. Court records state that Timothy bought one of the trailers from a company with its own premium refund.

Timothy is also accused of failing to return over $44,000 in premium refund monies to an oil field service company after it canceled its policy.

"(The) defendant placed numerous commercial clients at risk for substantial loss by failing to return premium refunds in his capacity as a licensed insurance agent, the exact amount of which is still being calculated," Utah Department of Insurance investigator Rick Angel wrote in a probable cause statement.

Court records show that Timothy may have failed to return at least $300,000 in refunds.

Timothy also conspired with fellow insurance agent Mark Foley to create fraudulent bonds worth more than $1.5 million for two construction companies, according to investigators, that put not only their clients, but the insurance companies involved at risk.

Foley pleaded guilty in November in 8th District Court to reduced charges for his role in the scheme and agreed to cooperate fully with the investigation into Timothy's conduct. He is awaiting sentencing.

A third agent from Timothy's office, Bart Winterton, pleaded guilty to forgery in October for signing a client's name to a insurance policy application. The charges against Winterton sprang from a separate state investigation. He has never been tied to any of Timothy's alleged activities.

In addition to keeping clients' refunds and creating phony bonds, authorities claim that Timothy ordered the shredding of 114 boxes of records from the Vernal and Roosevelt Service Insurance offices in July 2007, one month after a search warrant was executed on the Vernal office.