National Partnership of Insurance Brokers and its Former Subsidiary Agree to Pay Over $160 Million For Affordable Care Act Enrollment Fraud Scheme

AP of South Florida, LLC (APSF), an insurance brokerage company headquartered in Florida, has agreed to plead guilty for its role in an Affordable Care Act (ACA) enrollment fraud scheme.APSF, through its highest-ranking executives, preyed on thousands of vulnerable consumers to fraudulently enroll them into fully subsidized ACA plans, for which the federal government awarded $141.5 million in unwarranted subsidies. In a parallel civil resolution, AssuredPartners, Inc., a national partnership of insurance brokers and the then-parent company of APSF, agreed to pay $135 million to resolve allegations that it violated the False Claims Act by submitting fraudulent ACA health insurance plan applications. AssuredPartners, Inc., is not charged in the criminal information.

The Department of Justice announcedLinks to other government and non-government sites will typically appear with the "external link" icon to indicate that you are leaving the Department of Justice website when you click the link. this case and two others in support of President Trump's Task Force to Eliminate Fraud at a press conference in Washington today.

"Thanks to the leadership of President Donald Trump, the Department, working closely with the Task Force to Eliminate Fraud, is supercharging efforts to take down every fraudster and bring them to justice," said Acting Attorney General Todd Blanche. "In one day, the Department prosecuted the theft of a half-billion in taxpayer dollars. All those ripping off the American people are on notice."

The Criminal Case

The federal government offers subsidies to help eligible beneficiaries pay for health insurance plans. These subsidies are offered as tax credits to beneficiaries or as payments to insurers as Advanced Premium Tax Credits (APTCs). APTCs are paid directly to insurance plans by the federal government in the form of a payment toward the beneficiary's applicable monthly premium.

A criminal information was filed yesterday charging APSF with one count of major fraud against the United States. APSF has agreed to resolve the criminal charge by pleading guilty and paying restitution of $27.6 million. As part of its plea agreement, APSF admitted that, through certain of its executives and employees, APSF knowingly and intentionally defrauded the federal government. According to court documents, APSF targeted vulnerable, low-income individuals experiencing homelessness, unemployment, and mental health and substance abuse disorders, and, through "street marketers" working on APSF's behalf, sometimes offered cash and gift cards to induce those individuals to enroll in subsidized ACA plans. APSF enrolled these vulnerable consumers in ACA plans that were fully subsidized by the federal government by submitting false and fraudulent applications for individuals whose income did not meet the minimum requirements to be eligible for the subsidies. As a result of being enrolled in subsidized ACA plans for which they did not qualify, some of these consumers experienced serious disruptions in their medical care or prior insurance coverage under Medicaid or other programs. Some consumers who APSF fraudulently enrolled into fully subsidized ACA plans lost access to free health benefits through Medicaid or local assistance programs, and as a result, these consumers faced increased costs in accessing HIV medication, medication to treat opioid dependence and medication to treat mental health disorders. At times, consumers faced unaffordable co-pays and other costs because APSF enrolled these consumers in plans without regard to the consumers' medical needs, the availability of other programs (including Medicaid and local assistance programs) and the consumers' ability to pay out-of-pocket costs.

"APSF defrauded the U.S. government in order to line their pockets by exploiting the vulnerable," said FBI Director Kash Patel. "The FBI and its partners are working every day to put an end to corporate malpractice. We are turning off the spigot and other entities ripping off the taxpayer for illicit gain should take note."

"As yesterday's resolution demonstrates, the Criminal Division will pursue both corporate and individual actors that defraud the United States taxpayer and exploit consumers," said Assistant Attorney General A. Tysen Duva of the Justice Department's Criminal Division. "Together with our partners, we previously prosecuted the former President of APSF, who will serve 20 years in prison for his crimes. Yesterday, the Department is announcing that his employer, APSF, has agreed to plead guilty for its role in the scheme and will pay $27 million in restitution. For over a year, APSF made money on the backs of vulnerable consumers and by siphoning money from a critical social safety net meant to protect working families. The conduct was orchestrated by APSF's highest ranking executive and was pervasive throughout the company. Open and notorious corporate frauds will not be tolerated."

"Exploiting people in crisis to generate profit at the expense of taxpayers is unconscionable," said Inspector General T. March Bell of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). "By manipulating the ACA marketplace and disrupting access to essential treatments, APSF compromised core federal health care protections and inflicted real harm on consumers who relied on those safeguards. HHS-OIG will continue to work with our law enforcement partners to apply the full scope of our oversight and enforcement authorities to protect taxpayer dollars and consumers."

"Yesterday's action underscores that companies cannot enrich themselves by manipulating federal health care programs and exploiting vulnerable individuals," said Chief Guy Ficco of IRS Criminal Investigation. "In this case, executives falsified eligibility information to drive millions in improper subsidies, turning a program meant to provide care into a source of illicit revenue. IRS Criminal Investigation traced the flow of funds behind this scheme, and we will continue to pursue those who misuse taxpayer dollars for personal gain."

According to court documents, APSF received commissions and other payments from an insurance company in exchange for enrolling consumers in the ACA plans. In turn, APSF paid a street marketing company in exchange for consumer referrals. To maximize these commission payments, APSF used misleading sales scripts and other deceptive sales techniques to convince consumers to state that they would attempt to earn the minimum income necessary to qualify for a subsidized ACA plan, even when the consumers initially stated to APSF's insurance agents that they had no income. APSF also bypassed the federal government's attempts to verify income and other information and deliberately a large volume of applications to Medicaid for various individuals in a way that guaranteed their denial so that they could sign up these same consumers for a fully subsidized ACA plan and maximize commissions.

APSF's former president, Cory Lloyd, was previously convicted at trial in November 2025 for his role in the scheme and sentenced to twenty years' imprisonment. According to court documents, Lloyd began the scheme at a legacy entity. In February 2021, APSF acquired certain assets of that legacy entity. Lloyd then became the President of APSF, where he continued to orchestrate the fraud scheme on behalf of APSF.

Evidence presented in Lloyd's trial showed that, while President of APSF, he received complaints from a medical provider alerting Lloyd that multiple consumers, "who were homeless, were given cash to sign up" for these ACA plans. The provider further complained that: "All of them have opioid addiction and were desperate for money. All of them were unaware they had insurance until the provider tried to get them medications through the county hospital for uninsured patients. These people are worse off than if they had no insurance because they are being asked to pay >$500 per month for their medications." Evidence presented in Lloyd's trial also showed that, despite receiving such warnings, APSF continued to fraudulently enroll consumers in fully subsidized ACA plans by "bumping up" their income to make them appear qualified for subsidies.

A change of plea hearing for APSF will be set for a later date, where the terms of the plea agreement between APSF and the Department of Justice will be considered by a federal judge. If the plea agreement is accepted by the court, APSF will be sentenced by a federal district court judge at a later date.

The government reached its criminal resolution with APSF based on several factors, including the nature and seriousness of the offense conduct; the fact that the fraud began at a legacy entity whose assets were acquired by APSF in February 2021; APSF's failure to conduct adequate acquisition diligence, oversee the acquired operations, and detect the open and pervasive fraudulent scheme, which allowed the conduct to persist at APSF for approximately 18 months after the asset acquisition; and the pervasiveness of the offense, which involved multiple former APSF employees and former members of its senior executive management, including its President (Lloyd), who personally conducted and promoted the scheme. APSF also did not voluntarily and timely self-disclose the conduct to the Department of Justice but did receive credit for clearly accepting responsibility for its criminal conduct, cooperating with the government's investigation, and implementing remedial measures.

FBI, HHS-OIG and IRS-CI are investigating the criminal case.

Assistant Chief Jamie de Boer and Trial Attorney D. Keith Clouser of the Criminal Division's Fraud Section are prosecuting the criminal case.

The Fraud Section leads the Criminal Division's efforts to combat health care fraud through the Health Care Fraud Strike Force Program. Since March 2007, this program, currently comprised of eight strike forces operating in federal districts across the country, has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers more than $45 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the Office of the Inspector General for the Department of Health and Human Services, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at https://www.justice.gov/criminal-fraud/health-care-fraud-unit.

The Civil Case

The False Claims Act settlement resolves allegations that, from February 2021 through September 2022, APSF knowingly submitted false or fraudulent applications for subsidized ACA plans on behalf of thousands of consumers in order to obtain commissions and bonus payments from insurers. APSF contracted with "street marketers" who targeted homeless shelters, bus stops, drug treatment clinics and similar locations. The marketers offered incentives, such as cash or gift cards, to individuals to enroll in subsidized ACA plans or to provide their personal information so that APSF could submit applications on their behalf. APSF employees then submitted applications falsely representing that the consumers would make a minimum income amount just over the federal poverty line in order to cause the government to pay the highest subsidy amount.

APSF employees also knowingly submitted false information to Florida's Medicaid program in order to generate letters stating that the applicant was denied Medicaid coverage and then used these letters as a qualifying event to trigger a Special Enrollment Period, which allowed APSF to submit applications for ACA plans outside of the normal enrollment periods. APSF employees also evaded the federal government's attempts to verify information in consumers' ACA applications by submitting false information in response to inquiries from the Centers for Medicare and Medicaid Services when it sought to verify the false information (including income information) submitted by APSF. Some consumers experienced disruptions in their medical care as a result of being enrolled by APSF in subsidized ACA plans that did not provide coverage for their medical needs. APSF received commissions, bonuses, and/or other payments for consumers it enrolled in ACA plans, and a significant portion of APSF's revenues from these fraudulently obtained payments flowed up to its then-parent corporation, AssuredPartners.

"Federal benefit programs funded by American taxpayers provide an important safety net for vulnerable populations," said Assistant Attorney General Brett A. Shumate of the Justice Department's Civil Division. "Yesterday's resolution sends the clear message that the United States will hold accountable actors who exploit those programs to enrich themselves at the expense of the public."

"Our office will use all available tools, including the False Claims Act, to confront those who submit false claims under the Affordable Care Act," said U.S. Attorney Gregory W. Kehoe for the Middle District of Florida. "This case exemplifies our dedication to protecting our nation's taxpayers from fraud."

"This $135 million resolution lays bare a brazen scheme that caused real harm by targeting vulnerable individuals for profit and disrupting their access to critical care," said Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). "Because of APSF's manipulation of individuals' enrollment statuses, Medicaid and other programs intended to support vulnerable populations were undermined in fulfilling their mission. HHS-OIG will continue to aggressively pursue accountability for those who choose greed over patients and work to protect the integrity of public resources."

The settlement resolves allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery. The whistleblower will receive $24.3 million as their share of the recovery in this case.

The resolution obtained in the civil matter was the result of a coordinated effort between the Justice Department's Civil Division, Commercial Litigation Branch, Fraud Section, the U.S. Attorney's Office for the Middle District of Florida, and the Department of Health and Human Services Office of Inspector General.

The investigation and resolution of this matter illustrate the government's emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

The civil matter was handled by Attorneys Wendy Zupac and David Wiseman of the Civil Division's Fraud Section, and Assistant U.S. Attorney Jeremy Bloor for the Middle District of Florida.

The Commercial Litigation Branch's Fraud Section investigates complex health care fraud allegations and files suit under the civil False Claims Act to recover money on behalf of defrauded federal health care programs. Settlements and judgments under the False Claims Act exceeded $6.8 billion in the fiscal year ending Sept. 30, 2025. Working with United States Attorneys, investigative agencies, and whistleblowers, Fraud Section attorneys have recovered more than $85 billion in False Claims Act settlements and judgments since 1986.

The claims resolved by the civil settlement are allegations only and there has been no determination of liability in the civil settlement.