Former Insurance Executive Admits Role in Fraud That Led to Collapse of Two Companies

A former Bay Area insurance executive, Jasbir Thandi, pleaded guilty in federal court to conspiring to commit insurance fraud in a case that contributed to the collapse of two insurance companies—Global Hawk Risk Retention Group and Houston General Insurance Exchange (HGIE). The fraud schemes, which involved falsified financial records and unauthorized loans, caused over $20 million in losses and left hundreds of policyholders without coverage.

According to federal prosecutors, Thandi and his co-conspirators generated fake bank and brokerage documents to overstate capital reserves, misleading regulators in both Vermont and Texas. These misrepresentations allowed Global Hawk and HGIE to continue operations despite being financially unstable. Global Hawk was ultimately liquidated in 2020 after the fraud was discovered.

Thandi also diverted more than $1.5 million from Global Hawk for personal expenses, including purchasing a home and luxury car. Additionally, he secured multimillion-dollar lines of credit under the company’s name without board approval, using the funds to trade stocks rather than maintaining required reserves.

Thandi is the last of four defendants to plead guilty in the case, joining Sandeep Sahota, Jaspreet Padda, and Gunjan Aggarwal. He faces up to five years in prison for each count, with sentencing scheduled for August 29, 2025. The case underscores the significant regulatory risks posed by financial misconduct within the insurance industry.