Attorneys for two nephews of disgraced Grover Beach financier Al Moriarty are crying foul over the California Department of Insurance’s pursuit of felony insurance fraud charges against their clients even though local prosecutors had already charged them with lower-level misdemeanors.
Neal Moriarty, 38, of Morro Bay and Ross Moriarty, 42, of Los Osos were arrested by CDI agents July 22 on suspicion of “multiple” felony counts of insurance fraud over a $13,709 suspected bogus claim for repairs to Neal Moriarty’s truck, according to a news release issued by the agency Monday.
The CDI said those charges were forwarded to the San Luis Obispo County District Attorney’s Office for review.
However, the District Attorney’s Office had already rejected those recommendations three days earlier, instead filing two misdemeanor charges of insurance fraud against each brother, according to court records.
Sign Up and Save
Get six months of free digital access to The Tribune
Ross Moriarty, an insurance agent for Farmers Insurance, is accused of helping his brother, a Cal Fire captain, file a false claim after the latter hit a deer in his personal truck on Highway 101 while off duty. The CDI alleged that Neal Moriarty was uninsured at the time of the crash and that his brother reinstated his policy prior to making the claim.
Patrick Fisher, representing Ross Moriarty, said in a written statement Tuesday that his client denies the allegations.
“The incident is alleged to have occurred over one year ago and, after many months of cooperation with authorities, it was extremely disappointing that law enforcement saw fit to humiliate Mr. Moriarty by arresting him at his home, parading him through his neighborhood before taking him to jail,” he wrote.
Fisher noted that it is common for people suspected of crimes that do not present a risk to public safety to be sent a letter notifying them of charges and instructing them to appear in court.
“Rather, he was arrested in front of his children after having invited law enforcement to his home and, then, overzealously booked on four felonies,” Fisher wrote.
Ilan Funke-Bilu, representing Neal Moriarty, seconded Fisher.
“I think the procedural history of this case is stunning,” Funke-Bilu said. “Mr. Moriarty is exceptional, professionally and within the community, and a solid guy and father.”
Funke-Bilu also contested the CDI’s version of events in the case. He said Neal Moriarty’s first phone call after hitting a deer on Highway 101 was to his wife, not his insurance agent brother as alleged by the CDI.
The attorney said Moriarty then called the Farmers Insurance claim line and was able to legally reinstate his policy, which he paid for. He then filed a claim for damage to the truck before calling his brother.
The CDI in its news release claimed Neal Moriarty only withdrew the claim when CDI investigators requested his phone records.
“That’s not the way it went down,” Funke-Bilu said.
Neal and Ross Moriarty were initially booked into the Santa Cruz and San Luis Obispo county jails, respectively, and held on $120,000 bail each before judges released them on promises to appear in court after the misdemeanor charges were filed.
Spokesmen for the CDI and the San Luis Obispo County District Attorney’s Office did not return requests for comment Thursday.
Fisher indicated the brothers’ relation to their high-profile uncle — Al Moriarty, who was sentenced to five years in jail in September 2014 for bilking investors out of approximately $22 million in a Ponzi-type scheme — may have played a role in the brothers’ well-publicized arrest.
“My client has no financial ties to his uncle,” Fisher said Thursday. “But obviously, his uncle’s name is a big deal in this county.”
Both brothers are due to be arraigned in San Luis Obispo Superior Court on Aug. 10.