Evening star. [volume] (Washington, D.C.) 1854-1972, 1963-02-17
INSURANCE
INSURANCE
More Sales Pressure
Put Upon Servicemen
Continued From Page Al

agents Of one company which
was doing q large amount Of
its business by mail were
banned by the Defense Depart
ment from soliciting on all
military bases. The president
Of the company was found to
be guilty Of q conspiracy to
bride Navy enlisted men at
the Great Lakes and San Dr.
ego training centers in order
to obtain medical records of
new recruits.
The records Offered an ex-
cellent source" for home adj
dresses. parents names and
whether or not q recruit was
a good insurance risk, accord
ing to the Federal Bureau of
Investigation. This data was
used to solicit parents to take
out life insurance on their
sons.
The FBI, with the co-opera-
ton Of the Defense Depart
ment. broke up the conspiracy.
The president Of the company
was fined $4,000 and given a
five-year suspended sentence.
Several others accused, includ-
ing two agents operating q
firm "for the sole purpose Of
obtaining lists Of names Of
servicemen," were given fines,
suspended sentences and /or put
on probation. according to the
FBI.
In spite Of these convictions,
however, and the Departments
subsequent ban Of agents from
bases and withdrawal of privi-
leges to use servicemen's allot-
ments payroll deductions) for
payment Of premiums, the COM
pany can still solicit parents.
According to Best's Life In
surance Reports Of 1862, the
company had nearly 500 mil
lion Of insurance in force in
1861 and "transacts business
by mail throughout the United
States"
Prey on New Recruits
In a survey Of bases in the
Washington area, The Star
found no evidence Of the type
Of violations involved in the
foregoing case.
The general feeling Of Of
ficials at Fort Myer, Fort Bel
voir and Andrews Air Force
Base, the three installations
checked, was that the agent or
company trying to pull a fast
deal works around posts where
less experienced servicemen are
stationed. Primarily, veteran
and permanent-duty personnel
are assigned to bases in this
area.
Washington area men have
been stationed. however. in
large numbers at some Of the
posts where the FBI and De-
tense Department broke up q
life insurance racket involving
policies worth $l4 million.
Fort jackson. s. c., the train
ing center for practically all
recruits from the District.
Maryland and Virginia, was one
Of several Army posts involved
during 1860 and 1861. The
scheme used gross misrepre-
sentation Of insurance terms,
coercive practices and outright |
forgery Of actual and fictitious
names of servicemen." accord |
ing to the FBI.
Servicemen by the platoon"
in one instance, were tricked |
into signing what they believed
we're documents saying they |
did not want insurance. The pa
pers turned out to be allot-
ment forms authorizing deduc-
tions from their paychecks for
life insurance premiums,
A former Army private at
Fort Dix. N. j., testified at the
conspiracy trial that it was like
duck soup" signing up re-
cruits. When you're in the
Army three weeks you're dizzy. |
You can tell q recruit anything
and he'll do it," he explained.
Sergeant Gets a Rake-0ff
The sergeant he worked with
admitted receiving 81 from in
surance agents for each soldier
they signed up. Not satisfied
with their take. the pair forged
the names Of additional SOL
diers at the base onto allot-
ment forms.
The key to the scheme, how
ever, was that when the allot-
ment forms were processed the
Government, not the service
men, ended UP paying the
premiums.
A civilian employe at the
Army Finance Center in In
diana was involved in the con-
spiracy. The forged or fraudu-
lently obtained allotment
forms were hurried through
the processing procedure so
that premiums (Which are paid
in a lump sum TO each insur-
ance company for all the SOL
diers holding policies with the
company started going out,
but the corresponding deduc-
tons from soldier paychecks
were never made. according TO
the FBI.
The sale OF life insurance
directly TO the serviceman now
is under strict control. PEN
tagon officials report. OF the
hundreds Of insurance COM
panies that sell TO servicemen.
only a few have caused dif-
ficulties.
Regulations require registra-
ton OF all insurance agents
selling on military installations,
backed up by the penalty OF
suspension OF the soliciting
privilege for the slightest
abuse. Solicitation in barracks
or TO groups OF soldiers in Off
cial formations is forbidden.
Only policies meeting De-
fpnsn Dcnartnnant etanda ride |