Former AFLA Employee Convicted of Scheme to Defraud Insurance Company

Former AFLA Employee Convicted of Scheme to Defraud Insurance Company

A former sales representative for AFLAC has been found guilty of federal fraud charges stemming from a scheme that bilked the insurance company out of $4 million with fake disability claims.

Patricia Diane Smith Sledge, 60, of Redlands, was convicted late Tuesday in the scheme involving fictitious employers and “employees” who falsely claimed to have suffered injuries that prevented them from working.

At the conclusion of a two-week trial, the jury convicted Sledge of six counts of mail fraud. The jury also found that Sledge committed two counts of witness tampering while on bond in this case.

Sledge was ordered to return to court for a sentencing hearing on March 20, 2017, at which time the defendant will face a statutory maximum sentence of 160 years in federal prison.

The evidence presented at trial showed that Sledge, who was residing in Irvine while working for the company formally known as American Family Life Assurance Company, sold disability insurance policies to bogus companies and people who supposedly worked for those companies. Sledge then orchestrated the filing of fraudulent disability claims and directed the purported employees to doctors that would sign off on the fake injury claims.

As a result of the false claims, AFLAC suffered losses of approximately $4 million.

Sledge made money both from the commissions related to the sale of the fraudulent insurance policies and from kickbacks she received from the supposedly injured “employees.”

Sledge was also found guilty of witness tampering for encouraging potential witnesses to lie to federal investigators and discouraging them from cooperating in the investigation. Both counts related to conduct after Sledge became aware of the federal investigation, and one count stemmed from conduct after she was indicted in this case and freed on bond in 2012.Two others have been prosecuted for acting as fake employers and fake employees in this scheme.