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In a groundbreaking development, the Louisiana State Police (LSP) has initiated a comprehensive criminal investigation into the alleged involvement of Texas law firm McClenny Moseley & Associates (MMA) and Alabama construction contractor Apex Roofing & Restoration in what state authorities are calling the largest home insurance fraud case in Louisiana’s history.
I. The Investigative Pursuit
The LSP’s New Orleans-based Insurance Fraud/Auto Theft Unit is spearheading this criminal investigation, building on the groundwork laid by the Louisiana Department of Insurance (LDI). The LSP’s inquiry takes off from the compelling findings of LDI’s fraud investigators, who conducted interviews with 25 Apex customers. Shockingly, these customers reported that MMA had collected their insurance proceeds despite these individuals affirming that they had never engaged in MMA’s services.
II. Allegations and Potential Charges
The LSP investigators have confirmed that they are commencing their probe with five cases from St. Tammany Parish, with plans to expand their inquiry as needed. Within the scope of their investigation, the LSP is considering a range of potential criminal charges, including insurance fraud, forgery, bank fraud, and unlawful solicitation by attorneys.
In a decisive move earlier this year, the Louisiana Department of Insurance imposed a record-breaking $2 million fine on MMA and its founding partners, James McClenny and Zach Moseley. The former Louisiana partner of MMA, William Huye, was disbarred in Louisiana and subsequently relocated to Austin, Texas. As a result of a barrage of multimillion-dollar lawsuits by its financiers, MMA is on the brink of insolvency, no longer employing any licensed Louisiana attorneys and having shuttered its New Orleans office. However, Apex, which had enlisted MMA’s services upon venturing into the Louisiana market in 2021, continues to operate in multiple states, including Louisiana, where it maintains offices in Lafayette and Covington.
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The LSP’s inclusion of Apex in its investigation echoes a federal court order issued by U.S. Magistrate Judge Michael North earlier this year. The order explicitly stated that Apex had “assisted” MMA as its “agent” in what Judge North characterized as the “Apex scheme.” Judge North’s ruling also unveiled a separate “scheme” by MMA, wherein they allegedly paid $14 million to an Arizona marketing firm, Velawcity, to attract thousands of Louisiana clients through improper online messages.
III. Apex’s Response and Controversy
In response to these allegations, Apex initiated a malpractice lawsuit against MMA, strenuously denying any conspiracy with the law firm or the receipt of anything valuable to aid in acquiring clients. In a covertly recorded conversation exclusively obtained by WWL-TV, Zach Moseley, MMA’s sole remaining attorney, admitted to his New Orleans staff how MMA exploited an assignment of benefits document that Apex customers had signed with the roofer. Moseley revealed that MMA represented itself as the homeowner in dealings with insurance companies to expedite negotiations and payments.
Peter Butler, an attorney now representing Apex, expressed the company’s disappointment in being mentioned in the court’s opinion without the opportunity to present their side of the story. Apex’s position is that MMA acted as its agent under the law.
IV. Conflicting Claims
In their malpractice lawsuit against MMA, Apex alleges that MMA directed an Apex roofing employee, Trish Drummond, to sign contracts on behalf of Apex customers, effectively hiring MMA as their attorneys. However, a thorough review of court records by WWL-TV revealed that Drummond had signed a contract on a homeowner’s behalf a month before MMA allegedly instructed her to do so. The discrepancies in the timeline raise questions about the accuracy of Apex’s claims.
Butler announced that more documents would be presented in court to substantiate Apex’s claims but declined to provide WWL-TV with this evidence at the current time.
V. Victims Speak Out
Two former Apex sales staff members shed light on their involvement in MMA’s efforts to collect insurance funds for storm victims unknowingly caught up in the scheme. Dan Shaw, who trained Apex’s sales team, revealed training documents indicating that Level 2 and 3 salespeople were supposed to encourage homeowners to sign forms onboard MMA.
Shelby Lacey, a former Apex employee, stated that she and her colleagues were misled into believing that MMA acted as Apex’s “in-house lawyers” to ensure prompt payments from insurance companies. Lacey’s suspicions arose when she learned that her compensation was tied to the number of deals she secured for Apex and how many customers signed contracts with MMA. Subsequently, Lacey was terminated by Apex and started her own roofing company, Skyline Roofing & Construction. In a lawsuit filed last month, Lacey alleged that her compensation from Apex was often withheld if homeowners failed to sign a separate representation agreement with McClenny Moseley.
In response to these claims, Apex vehemently denied the allegations made by Lacey and Shaw, stating that they would defend themselves in the ongoing litigation.
The unfolding investigation, paired with the testimonies of those allegedly affected by this insurance fraud, underscores the importance of vigilance and oversight in the insurance industry as authorities uncover the intricate web of deception woven by those involved.
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