An insurance executive involved in a massive health care fraud scheme will spend nearly three years behind bars for his role in defrauding U.S. taxpayers of more than $133 million while depriving vulnerable South Florida residents of essential medical care.
Dafud Iza, 55, a former vice president at Fiorella Insurance Agency, was sentenced to 35 months in federal prison after pleading guilty to major fraud against the United States. Prosecutors said Fiorella employees targeted homeless shelters, bus stops, and addiction treatment centers to recruit low-income individuals eligible for Medicaid, offering them small cash payments—sometimes as little as $5—to sign insurance forms.
Instead of enrolling them in Medicaid, employees falsified applications to ensure applicants were denied coverage. The agency then fraudulently signed them up for Affordable Care Act (ACA) insurance plans with high deductibles and co-pays the individuals could not afford, often cutting them off from critical HIV and addiction treatment services.
Between 2019 and 2022, the scheme spanned Palm Beach, Broward, Miami-Dade, and St. Lucie counties. Once Medicaid coverage was denied, Fiorella employees submitted ACA applications falsely stating that consumers were employed and earning enough income to qualify for full government subsidies. Internal evidence showed staff were routinely instructed to list incomes at the minimum required level, regardless of reality.
To avoid scrutiny, the company implemented a so-called “subsidy fix” process that fabricated qualifying life events to extend enrollment deadlines and evade income verification, ensuring continued government payments and commissions.
As operations manager, Iza oversaw internal communications where staff repeatedly raised concerns about bribery and fraudulent enrollment practices. Prosecutors said management failed to intervene despite clear warning signs.
Although Iza faced up to 10 years in prison, federal prosecutors sought a reduced sentence in exchange for his cooperation against co-conspirators Cory Lloyd, Fiorella’s chief operating officer and president, and Steven Strong, a marketing executive who recruited consumers. Both were convicted in November on multiple fraud-related charges and face potential life sentences.
U.S. District Judge Rodney Smith approved a 50% reduction from sentencing guidelines and imposed a 35-month sentence on Jan. 6. Iza, along with Lloyd and Strong, has been ordered to pay $133.9 million in restitution. He must report to federal authorities by Feb. 13, while Lloyd and Strong are scheduled for sentencing in February.
