The former president of a Baldwin insurance agency was arraigned Monday on a grand jury indictment charging him with stealing more than $800,000 from clients, mostly by pocketing money paid for insurance premiums, Nassau County prosecutors said.
Joseph Koch, 56, of Jericho, spent the stolen money on personal expenses, including purchases at retail stores and country clubs, gambling, Mercedes-Benz payments, income taxes and home mortgage payments, prosecutors said.
Koch was arrested Aug. 30, 2012, by investigators from District Attorney Kathleen Rice's office and charged with three counts of second-degree grand larceny, third-degree grand larceny and first-degree scheme to defraud, officials said.
He was arraigned before Nassau County Court Judge Anthony Paradiso on additional grand jury charges, including two counts of second-degree grand larceny, third-degree grand larceny and fourth-degree grand larceny, prosecutors said.
Paradiso continued bail at $100,000 bond or $50,000 cash. Koch is free on bond and is due back in court Dec. 2, according to online court records.
Koch faces 5 to 15 years in prison if convicted of the top charge.
Between May 8, 2009, and March 31, 2010, Koch, as president of The Louis Koch Insurance Agencies Inc. in Baldwin, was paid $648,074.13 in insurance premiums by a Queens commercial property management company, prosecutors said. The funds were not forwarded to several insurance companies for which he was acting as an agent, officials said.
On June 26, 2009, prosecutors said, Koch stole $10,572.56 from the same Queens commercial property management company. The money was to make a premium payment for an insurance policy, which Koch never purchased on its behalf, prosecutors said.
He also failed to forward insurance premium payments made by other clients to insurance companies and insurance brokers, including $51,244.50 to a Cincinnati-based insurance company; $20,000 to a Woodbridge, New Jersey-based insurance broker; and $2,525.40 to a Fairview Park, Ohio-based insurance broker, according to a news release from Rice's office.
Koch paid $13,228.57 to the Cincinnati company after it retained a collection agency. He also paid the Fairview Park broker in full as a result of Rice's investigation, officials said.
Between March 30, 2005, and July 31, 2012, Koch stole $97,546.94 from a Florida woman, consisting of funds that were given to him for her benefit by three of her nephews and a niece, officials said. The money was to be paid the woman monthly until the funds were exhausted, the news release said.
In the course of Koch's schemes, he stole $829,963.53, of which he has since repaid $222,164.02. The remaining amount outstanding is $607,799.51, prosecutors said.
The case was referred to Rice's office by the state Department of Financial Services. Koch's arrest came after a joint investigation by the two agencies.
Benjamin M. Lawsky, state superintendent of financial services, said in a statement that Koch "betrayed a position of trust when he enriched himself at the expense of numerous innocent victims."