It was just Insurance Fraud
After suffering various illnesses, Matson's victims discovered with trepidation that Interstate Health Insurance was a fraud.
The health insurance plan refused to pay large medical bills. Smaller medical bills were often paid. The unfortunate customers who had incurred a life threatening illnesses or accident were forced to beg, plead, and sell their possessions to pay their mounting medical bills.
The Benson family held church bake sales and received hospital charity to cover the gargantuan hospital bills. Treatment was needed for Jimmy to have a chance at reaching adulthood.
The teenage son of another Matson policy holder was seriously hurt in a motorcycle crash. A half million dollars of medical bills were went to Matson's bogus operation.
Matson refused to pay.
Matson was a con man and his customers struggled with treatment and medical bills.
Meanwhile, the Oklahoma man and his fellow fraudsters used the health insurance premiums to live life lavishly.
Matson's mode of operation
Their phony company paid them huge salaries, and bought expensive clothing, gambling junkets, luxury cars like Mercedes and Ferraris, etc.
Here is Matson's mode of operation. He lured regular American families, those trusting people who are the cornerstone of our nation to buy cut rate health insurance from his company. In recent years health premiums have risen dramatically and many mom and pop operations are having trouble coping with rising health insurance premiums.
Cheap health insurance premiums, comprehensive benefits and relatively easy acceptance to the health insurance plan caused many to not investigate further. Interstate Health Insurance had glossy brochures and low prices. Apparently that was enough to cause 1,700 families to take and unnecessary risk of purchasing a less expensive yet "non-existent" health insurance policy.
Interstate Health Insurance also had licensed health insurance agents sell the fraudulent health insurance coverage. Health insurance agents, with their polished sales skills and convincing manner, provided the perfect cover for Matson.
The local health insurance agents made the fraud all the more convincing. Local businesses were purchasing the coverage in the nine states at a steady pace.
Matson's promise to the local health insurance agents and subsequently to the local customers was that he would simply pool the total premiums and pay claims from the incoming money.
Interstate promised to purchase additional coverage from an "A" rated insurance to eliminate any risk altogether.
Matson was just a con man
Matson bought so-called excess coverage from a Bahamas based company that was licensed to sell health insurance in the United States.
This was fraud, pure and simple.
For at least 13 years Matson operated this fraudulent health insurance scam. At various times, various state government officials would close down his operation. Matson would simply open up under another name to recruit more policyholders.
The existing health insurance policy holders were simply kept on paying the health insurance premium. They were playing roulette with their health and wealth and unknowingly were taking large risks.
Government regulators never found out exactly how much premium money was stolen or exactly how much in unpaid medical bills were left with unfortunate health insurance customers
In the year 2002
Steve Matson was convicted of criminal fraud charges, and was sentenced to 14 years in federal prison.
It seems that Steve Matson will be living a relatively quiet life behind bars while many of his victims are still struggling to repair the damage caused by a crooked con man.
