The Federal Trade Commission is trying to shut down what it calls a “sham” health care marketing operation that allegedly collected more than $100 million, much of which the owner reportedly spent to fund his lavish lifestyle.
According to a recently unsealed FTC complaint reported on by the Miami Herald, Stephen J. Dorfman is the owner or manger of Simple Health Plans and various other connected healthcare marketer companies that draw people in through telemarketing calls and various scammy, misleading websites like trumpcarequotes.com. The Trump Care Quotes website, which is still accessible online, claims to connect customers with insurance agents, and offer “health insurance for smart people.”
The complaint alleges the operation has attracted “tens of thousands” of customers over the last three years, with false claims that they could obtain a policy that covers preexisting conditions and prescription medications. Instead, they were given a medical discount program that allegedly provided no coverage of preexisting conditions or prescription medications.
“Many consumers were misled into thinking they had purchased comprehensive health insurance, but when they needed to rely on that insurance, they learned they had none of the promised benefits,” Andrew Smith, director of the FTC’s Bureau of Consumer Protection, said in a press statement. “The plans defendants were selling are not health insurance and they aren’t a substitute for health insurance.”
Because of the alleged false claims and deceitful practices, Dorfman and others involved have been charged with violating the FTC’s Telemarketing Sales Rule and the FTC Act.
A federal judge ordered the operation to temporarily shut down, granting the FTC’s requested restraining order. The FTC said in a press release it plans to permanently stop the scheme and return money to customers.
A Gizmodo request for comment sent to an email address listed on Simple Health Plan’s site failed to deliver. Dorfman’s attorney Ryan D. O’Quinn did not immediately respond to a Gizmodo request for comment. In an email to the Sun Sentinel and New York Times, O’Quinn reportedly said: “Mr. Dorfman vigorously denies the allegations of misconduct made by the Federal Trade Commission, and he looks forward to having an opportunity to defend himself in the appropriate forum.”
In the FTC’s request for a temporary restraining order against Simple Health Plans, shared by Sun Sentinel, the agency alleges “the architect of this scam,” Dorfman, “siphoned millions of dollars of proceeds from defrauded consumers to pay for private jet travel, gambling sprees in Las Vegas, the rent for his oceanfront condominium, luxury automobiles, over $1 million in jewelry, and even the nearly $300,000 cost of his recent wedding at the St. Regis Hotel in Miami.”
Dorfman reportedly used the money to purchase a Lamborghini and Rolls Royce, and spent $57,000 on one night club tab.