For years, one small disaster after another followed Verdon Taylor. He would buy a used car, own it for a while, and it would catch fire. He would move into a rental property and soon his belongings would go up in flames. He would purchase a mobile home, only to see it burn, with all of his possessions lost.
Several of his acquaintances were similarly beset by combustion, based on the numerous insurance claims they filed for ruined vehicles, houses, apartments and trailers. Before a federal grand jury in Richmond indicted Taylor and five others in an arson-for-profit scheme, they collected nearly $1 million from 17 insurance companies, according to authorities, who said the claims involved 33 fires in 16 years in southeast Virginia and central Florida.
Taylor, 72, a Florida resident and the convicted ringleader, was sentenced to 40 years in prison this month after a trial in U.S. District Court in Richmond. Another defendant, Vershawn Jackson, 39, of Richmond, got a five-year prison term after pleading guilty to fraud. Two other participants in the scheme are awaiting sentencing after pleading guilty, court records show, and the case against one person was dismissed.
The scheme was fairly simple and apparently took advantage of weaknesses in the insurance industry's system for identifying people who file multiple suspicious claims, according to prosecutors and a spokesman for the National Insurance Crime Bureau, an industry association set up to combat fraud for its 1,100 member companies.
The defendants, especially Taylor and Jackson, would buy cars at auctions for discount prices, insure them, then set them on fire and collect more money from the claims than they had paid for the vehicles, authorities said. They would buy old mobile homes, stock them with cheap furniture and other items from flea markets, then insure the homes and possessions for more than they were worth before torching them.
More than half of the 33 fires, from 2000 to 2016, occurred in and around Richmond, the indictment says. The others were in Florida, mostly near Orlando.
Taylor, the convicted mastermind, "advises that he has a fourth grade education," his attorney, Jeffrey L. Everhart, said in a court filing before the trial. In asking a judge to order a mental-competency evaluation of Taylor, Everhart said it was "obvious from a layman's observation that he is unable to read and write."
The lawyer added: "Mr. Taylor's family reports that he suffered a stroke eight years ago. Family members report a deterioration in his cognitive ability, as well as his ability to care for himself." But he was eventually ruled competent to stand trial.
"A classic scheme," said Frank Scafidi, spokesman for the insurance crime bureau, which was not involved in the investigation.
Speaking of fraud cases generally, he said: "These guys will go buy a car that looks pretty decent at auction, but usually there's something wrong with it, maybe mechanically. So they get it for pennies on the dollar sometimes. And then they turn around and get insurance, as if the car was in great shape. And, bingo, next thing you know, there's a fire, and the claim is paid, and they're on to the next one."
Years ago, a company often would inspect a car before insuring it, but those days are gone, Scafidi said. "With the advent of the Internet, it's possible to sell a lot of policies very quickly, and you see people issuing policies left and right." High-volume sales are important, he said, because "profit margins in the industry are so tight."
Companies require buyers to state on their applications whether they have filed insurance claims in prior years. According to the indictment, each participant in the scheme victimized multiple companies, but no defendant bought a policy from the same company more than once. When asked on their applications whether they had filed claims with other companies in previous years, they falsely said no.
When a person files a claim, a company, before paying it, might investigate to see whether the customer's application was truthful, Scafidi said. But there are limits to what a company can find out and how much resources it wants to invest in the effort.
He said antitrust laws restrict how much information competing insurance companies can pool. When a company suspects a claim is fraudulent, it can ask the National Insurance Crime Bureau to look into the customer's history. He said there is a private company that keeps an industry-wide claims database, but it is not comprehensive. And investigations can be expensive, making them not cost-effective.
A Jaguar, a Cadillac, another Cadillac, yet another Cadillac, a Dodge, another Dodge and a Lincoln Navigator — those were vehicles, most of them years old when they were purchased, that burst into flames after Taylor bought them. Two rental properties he lived in burned and so did three mobile homes.
In 2009, after a fire at a Richmond-area mobile home owned by a friend of Taylor's, authorities tried to interview the owner, Dorel Watson, then 32, of Florida, according to a court document. Watson was eventually indicted in the scheme, but the charge was dismissed. The investigators approached her at a hotel where she was staying.
"During this interview, Watson received a phone call and stated to the caller, 'They're here right now,' " the document says. "About two and a half minutes later, Verdon Taylor appeared at the hotel and interrupted the interview. He shouted at investigators, stating, among other things, 'She's like my daughter! I raised her! You don't have nothing on her!' He also unsuccessfully prevailed upon Watson to leave with him."
The biggest insurance settlement came in 2015, after Jackson bought a house in Richmond for $274,900, with a $269,920 mortgage. On Nov. 11 that year, eight days after the purchase, the house was destroyed by fire, a court document says. The insurer covered $303,173 in losses.
The last fire involving Taylor occurred in Jarratt, Va., at a mobile home he bought for $40,000, with a $38,000 mortgage.
On May 11, 2016, six months after the purchase, fire consumed the mobile home, and Taylor filed a claim with Foremost Insurance Group.
In an interview with a Foremost adjuster, the indictment says, Taylor "falsely denied having any prior fire claims, then admitted having claims for one house fire in Florida and one vehicle fire, and then falsely denied having any other fire claims."
By then, law enforcement officials had finally caught on to the scheme.
"On or about September 20, 2016," the indictment says, "Foremost issued a letter to VERDON TAYLOR denying his claim."