A 2012 investigation by the State of Utah Insurance Fraud Department found that Kelling, who operated Kelling Insurance, misled those customers by telling them insurance policies were issued when, in fact, no such policies were in place, according to court documents filed by the Utah Attorney General’s office.
As part of a plea bargain with state prosecutors, Kelling pleaded guilty to two felony counts of theft by deception and a third-degree felony charge of providing fraudulent insurance information. The theft charges stem from separate incidents in 2010 and 2011 when Kelling accepted insurance premium payments from a Moab business owner, kept the money and did not arrange for an insurance policy to be issued. In the 2010 incident, the payment exceeded $5,000, making that charge a second-degree felony. The 2011 incident involved a payment of more than $1,500 but less than $5,000, resulting in a third-degree felony charge, according to court documents.
Kelling also admitted to providing a false certificate of insurance to the customer in 2011, according to court documents. Under the plea agreement, Kelling agreed to relinquish his license to sell insurance, according to court documents.
The charges carry a possible sentence of up to 15 years in prison as well as thousands of dollars in fines, but prosecutors agreed to recommend Kelling serve no jail time and, instead, be placed on supervised probation for 36 months. Seventh District Judge Lyle Anderson will consider those recommendations when Kelling appears for sentencing on March 12.
The case came to light when the business owner filed a complaint with the Utah Insurance Fraud Division. In that complaint, the business owner said he had become concerned after not receiving policy documents from the insurance company. He said that when he contacted the insurance company he learned no policy had been issued, according to information from the Attorney General’s office.
As part of the plea bargain, the state Attorney General’s office agreed not to pursue additional charges in two other cases involving Kelling. Under the plea bargain, Kelling agreed to pay restitution totalling more than $18,800 to those customers who were involved in the three cases. He also agreed to pay $2,000 in restitution to the state’s Department of Insurance, Fraud Division, according to the plea agreement filed in 7th District Court.