LINCOLN, Neb. (KOLN) – Jeffery Smith, a former insurance examiner, was sentenced on Thursday after being convicted for attempting to steal nearly $850,000 through fraudulent claims. Smith, 57, was sentenced for attempted theft by deception of over $5,000. He will serve a three-year sentence, with 308 days already served.
The case began when the Nebraska Department of Insurance’s Insurance Fraud Prevention Division received a fraud report on Nov. 13, 2023. American Heritage Life Insurance Company and Allstate Benefits filed the claim, alleging Smith submitted fraudulent claims, ultimately collecting $885,230.
Smith, who worked as a claims examiner for American Heritage Life, was responsible for reviewing claims while working from home. Investigators discovered discrepancies in claims handled by Smith, which triggered an audit. Internal investigators found that Smith’s claims totaled $935,830, with $885,230 paid out to Smith’s accounts. The investigation revealed that Smith could not provide documentation to support the medical services claimed.
On Nov. 9, 2023, during an internal interview, Smith admitted to submitting the fraudulent claims, stating that he was being “blackmailed.” Further questioning by state investigators on Dec. 26, 2023, revealed Smith’s claims about his friend Robby being kidnapped in Brazil in July 2023. According to Smith, a man named Pablo demanded $750,000 for Robby’s release. Unable to raise the funds, Smith filed fraudulent claims to collect the money, which he claimed was transferred to Pablo. Smith also stated that nearly $500,000 of the stolen funds were being invested in a “big project” with another individual.
State investigators reviewed Smith’s financial records and found 52 false claims filed between April 11, 2023, and Nov. 6, 2023. Two additional claims were reversed before deposit, but investigators estimated that Smith collected a total of $830,895.
Smith’s conviction highlights the seriousness of insurance fraud and the penalties for attempting to deceive insurers for personal gain.