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Orange County agent arrested in $1.6 million fraud scheme targeting elderly
ORANGE, Calif.¬†–¬†Department of Insurance detectives today arrested Mark Malatesta, 55, of San Clemente, on 16 felony counts related to a $1.6 million fraud scheme targeting elderly southern California residents.

Malatesta, a licensed insurance agent at the time, allegedly exploited at least six elderly consumers by falsifying information on annuity applications and netted more than $135,000 in illegal commissions. Malatesta faces a range of other charges.
“Increasingly we are uncovering financial scams that target seniors,” said Insurance Commissioner Dave Jones. “These crimes are reprehensible and we will continue to work with our district attorney partners to aggressively investigate and prosecute anyone who targets seniors.”
An investigation revealed Malatesta convinced his senior victims to terminate their investments, causing them to lose a total of $45,000 in surrender penalties. In a classic churning scheme, Malatesta then sold them new annuities for which they did not qualify due to their advanced age. The fraudulent investments were canceled by the insurers once they discovered Malatesta provided false information.
When insurers canceled the new investments, they refunded the $1,616,897 in deposits when they refunded the victims. The department suspended Malatesta’s insurance license and will pursue revocation if he is convicted of the charges. This case is being prosecuted Orange County District Attorney’s Office.
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