Two insurance and marketing executives were convicted and sentenced to 20 years after a federal case found they ran a years-long scheme that funneled more than $233 million in Affordable Care Act subsidies through fraudulent enrollments of vulnerable people, costing taxpayers at least $180 million and leaving many victims with disrupted care.
Two men, identified at trial as Cory Lloyd, 47, of Stuart, Florida, and Steven Strong, 43, of Mansfield, Texas, were each given 20-year prison terms for orchestrating an extensive fraud operation tied to ACA plans. Prosecutors say the defendants built a network that enrolled tens of thousands of people into fully subsidized plans they did not qualify for, collecting millions in commissions from insurers. The scheme used third-party marketers and manipulative sales techniques to turn vulnerable stories into profit.
Court evidence showed the conspiracy sought over $233 million in fraudulent ACA subsidies, with the federal government paying at least $180 million as a result of the false enrollments. Officials say the defendants moved money through licensed insurance channels and then shared commissions, creating an appearance of legitimacy while siphoning off taxpayer funds. Federal authorities later ordered more than $180.6 million in restitution tied to the convictions.
“Preying upon medically compromised consumers to rob hundreds of millions from taxpayer-funded programs is evil and unforgivable,” said Attorney General Pamela Bondi. Her statement underscored a basic point: exploiting public programs and the people they are supposed to serve corrodes both trust and public safety. From a conservative perspective, the case is an example of why strict enforcement and accountability matter.
The scheme targeted people struggling with homelessness, unemployment, and serious health problems, including mental illness and substance use disorders, according to the trial record. Prosecutors introduced testimony that street-level recruiters sometimes offered bribes to induce enrollments, funneling at-risk individuals into plans that were profitable for the perpetrators but harmful to the consumers. That approach deliberately turned human misery into a revenue stream.
“These defendants didn’t just commit fraud; they built a business model around exploiting people at their most vulnerable,” said FBI Director Kash Patel. The FBI framed the case as both a financial crime and a public-safety issue, noting the defendants put victims at risk of losing access to critical medical care. The message from investigators was clear: exploiting federal programs for profit will be met with rigorous pursuit.
Trial evidence showed repeated deception: false applications, fabricated income claims, and concerted efforts to bypass federal income verification systems. The defendants allegedly filed thousands of Medicaid applications engineered to be denied, so those same individuals could be signed up for fully subsidized ACA plans outside open enrollment. That tactic let the operators chase commissions year-round instead of being limited to legitimate enrollment windows.
“These defendants will rightly spend decades in prison for taking advantage of thousands of vulnerable people and stealing millions from a health care safety net designed for working families,” said Assistant Attorney General A. Tysen Duva. The Justice Department characterized the defendants as sophisticated, licensed brokers who willfully exploited people who had nothing. The sentences were framed as necessary to deter similar schemes and protect both taxpayers and beneficiaries.
As a result of the fraudulent enrollments, some consumers suffered real medical harm, losing continuity of care or access to life-saving treatments. Individuals with opioid use disorders, serious infectious diseases, and mental health needs faced disruptions that could worsen outcomes and increase public costs. Prosecutors stressed that the fraud did more than steal money — it risked lives.
“These defendants designed a purposeful scheme to profit from human suffering, targeting individuals at their most vulnerable moments, solely for personal gain,” said Inspector General T. March Bell of the U.S. Department of Health and Human Services, Office of Inspector General. HHS-OIG emphasized partnership with law enforcement to hold program abusers accountable. The agency framed its role as protecting program integrity and patient safety.
Evidence at trial detailed how Lloyd collected commissions from insurers and paid Strong for referrals, creating a steady stream of illicit revenue. “Benefit fraud against public programs isn’t just a crime — it hurts real people, especially the most vulnerable,” said IRS Criminal Investigation Chief Guy Ficco. Federal investigators emphasized that criminal consequences follow when people treat public benefits as a business opportunity.
The record included the defendants’ own messages boasting about money and mocking victims, a troubling window into motive and mindset. In one exchange, Strong suggested sending marketers into hurricane shelters, and Lloyd replied, “It’s a killer idea, if we could pull it off! … I want to rake the shelters! R*pe.” Strong replied, “Haha I’m not kidding,” and Lloyd confirmed, “Me either…let’s f*uck em up.” Those texts were used at trial to show callous intent.
Money from the scheme reportedly paid for luxury purchases including a waterfront home in the Florida Keys, an 80-foot yacht, and a Tesla. In Nov. 2025, Lloyd and Strong were convicted of conspiracy to commit wire fraud, multiple counts of wire fraud, and conspiracy to defraud the United States, and Strong faced additional money laundering counts. Both men received 20-year sentences and were ordered to pay $180.6 million in restitution; a third defendant, Dafud Iza, previously pleaded guilty and was sentenced to 35 months.
Investigations were led by the FBI, HHS-OIG, and IRS-CI, with prosecutors from the Criminal Division’s Fraud Section and the Southern District of Florida handling the case. The Fraud Section’s Health Care Fraud Strike Force was cited, a long-running program that has charged thousands and pursued billions to protect federal health programs. For those who value fiscal responsibility and the rule of law, this case is a stark reminder that breaking both harms people and will not be tolerated.
