On July 18, 2025, a 69-year-old man in a wheelchair was rolled into Courtroom 2 of the Oakland federal constructing and sworn in. Decide Jon Tigar requested Jasbir Thandi whether or not all the things in paragraph 2 of his plea settlement, the paragraph describing what he did to International Hawk Insurance coverage Firm Danger Retention Group and to Houston Common Insurance coverage Trade, was true and proper. Sure, Your Honor. Two counts of conspiracy to commit insurance coverage fraud. Responsible, sir. Responsible, sir.
He returns to that courtroom on Aug. 28 for sentencing. I wish to spend a while earlier than that strolling by way of what he did as a result of International Hawk isn’t just a fraud story. It’s the finest demonstration of what occurs when trucking lets a foul insurance coverage product, a thinly capitalized market, and the individuals who run each onto the freeway on the identical time.
Jasbir Thandi got here to the USA from Punjab, constructed a Livermore, California insurance coverage brokerage known as International Century Insurance coverage Brokers round 2005, and by 2009 had a Vermont-domiciled danger retention group writing auto legal responsibility for truck drivers and small trucking firms throughout the nation. He was International Hawk’s president, treasurer, and director. He owned 100% of International Century, the managing basic agent that issued the insurance policies, collected premiums, managed the financial institution accounts, and maintained the books. He was president and sole stockholder of American Freight Forwarders & Transportation Inc., the “founding member” whose capital contributions had been supposed to maintain the insurer solvent. Court docket data present he was additionally the only real director of Gray’s Funding Inc., an actual property firm he integrated in 2016. One man, each seat on the desk, and a 17.5% fee on each coverage his brokerage bought to the insurer he managed.
Now, between 2016 and 2020, based on the Vermont liquidator’s federal grievance and the indictment that adopted, Thandi borrowed about $14 million from Stifel Financial institution & Belief in International Hawk’s title by falsely certifying that the board had approved it. The board had approved nothing. All however $175,000 of the mortgage cash went to a International Century account, to not the insurer. When the mortgage got here due, he paid it off with $10.7 million of International Hawk’s personal funds. Alongside the way in which, per the grievance, a $4.5 million cashier’s examine went to an organization known as Houston Administration Consulting Inc., which the indictment describes as Thandi-controlled. About $3.1 million was wired to Gray’s Funding. On Feb. 6, 2019, he despatched $1,189,542 in insurance coverage proceeds to an account for Introduction Fund Ltd, an entity that federal prosecutors say was Thandi-controlled and domiciled within the British Virgin Islands. He advised Stifel it was an outdoor funding. He admitted in his plea that he spent greater than $1.5 million of the misappropriated funds on private use, together with a home and a luxurious automobile.
Overlaying the opening required paperwork, and the paperwork is the place this case earns its place within the fraud historical past corridor of fame. Vermont regulators had requested International Hawk to shore up its capital, so Thandi reported $13.6 million in contributions in 2017. The liquidator later in contrast the deposit receipts despatched to Vermont towards the actual financial institution statements. The place the receipts mentioned $3,000,000, the financial institution mentioned $300. The place they mentioned $3,600,000, the financial institution mentioned $360. The place they mentioned $1,000,000, the financial institution mentioned $100. Someone was photocopying deposit slips and including zeros. The 2018 annual assertion, signed underneath oath earlier than a California notary by Thandi and his vice chairman, Sandeep Sahota, advised Vermont the corporate held $44.9 million in money at Stifel. The actual mixed stability was about $12.1 million. By the 2019 assertion, the fiction had come totally free from the bottom: it claimed $17.9 million at Stifel, in accounts that had been closed for almost a 12 months. A month-to-month assertion from the corporate’s funding adviser stored reporting balances, month after month, for accounts that now not existed.
Then there are the ghost insurance policies. Vermont had capped International Hawk at $15.5 million in new enterprise for 2019. So greater than 500 insurance policies merely by no means made it into the corporate’s data. The liquidator discovered them by evaluating FMCSA’s insurance coverage submitting database towards the dealer’s personal information: 512 insurance policies, prefixes comparable to CALQ and NVLQ, the primary efficient in June 2019. Greater than half of all the brand new insurance policies issued in International Hawk’s closing 11 months had been off the books. Actual vans, actual filings with the FMCSA, actual certificates within the arms of shippers and brokers, and no insurer behind them who knew they existed.
The tip got here quick. In late April 2020, the Vermont captive supervisor, who additionally sat on the board, requested Thandi for the precise Stifel statements. He ignored the request. On Could 1, the supervisor known as Stifel and was advised the approved signatory had denied it. On Could 6, he resigned from the board. Vermont seized the corporate on Could 20, and a state courtroom ordered liquidation on June 8, 2020. International Hawk’s final annual assertion had claimed $42.7 million in belongings. The banks held $609,481. The liquidation order described the 1,008 vans then on International Hawk paper as successfully uninsured.
Why did he do it? The boring reply is the sincere one. International Century collected $5.2 million in charges from International Hawk in 2017, $2.7 million in 2018, and $2.7 million extra in 2019. The fraud was what stored the enterprise mannequin alive after the cash was gone.
So the place does accountability stand, six years later? On paper, it appears nice. A federal courtroom in Vermont entered a $66.7 million default judgment towards Thandi and International Century in 2023. All 4 legal defendants, Thandi, Sahota, funding adviser Jaspreet Padda, and Gunjan Aggarwal, have pleaded responsible. Padda bought 30 months in Could. Aggarwal bought 18 months in April. Sahota is sentenced on Aug. 14, and Thandi on Aug. 28. On July 2, Decide Tigar entered a stipulated restitution order of $38,829,382, cut up 85.5% to the Vermont liquidator and 14.5% to the Texas receiver for Houston Common. The liquidator has additionally sued Crowe LLP, the nationwide accounting agency that issued clear audit opinions on International Hawk’s monetary statements; Crowe denies legal responsibility, the case survived abstract judgment motions this spring, and it stays unresolved.
Now what do the victims get? Vermont’s accounting within the restitution order tallies $38.5 million in International Hawk liabilities, most of it coverage claims, towards roughly $5.2 million recovered: $1.5 million in money discovered at liquidation, a $3.7 million settlement from Lloyd’s of London, and $55,000 from Padda. Every part else hinges on gathering restitution from a 70-year-old defendant whose attorneys filed a 2024 declaration supporting his request for appointed counsel as a result of he might now not pay them. The $66.7 million civil judgment sits towards the identical empty pockets.
In the identical fraud, run by the identical man, the Texas victims had been paid, and the trucking victims weren’t. Houston Common was a conventional insurer, so when it collapsed, the Texas Property and Casualty Insurance coverage Warranty Affiliation stepped in and paid $4.8 million in claims, precisely as warranty funds have accomplished for each failed typical insurer for half a century. International Hawk was a danger retention group, and federal regulation, 15 U.S.C. 3902, bars RRGs from each state warranty fund in America. No backstop exists. When an RRG dies, the crash victims stand in a liquidation line behind the attorneys and the accountants, and so they take no matter fraction is left. The 2 halves of Thandi’s personal conspiracy are a managed experiment in what that statute prices, and the trucking aspect misplaced.
I’ve been constructing the dataset of what the lifeless RRGs left behind. My database of the three failed trucking RRGs, International Hawk, Spirit Industrial Auto, and Federal Motor Carriers, covers 19,588 carriers that had been insured by them in some unspecified time in the future, with 49,812 crashes, 1,478 of them deadly, 1,770 folks killed, and 23,519 injured throughout these carriers’ recorded histories. International Hawk’s e book was the most important of the three: 10,333 carriers. Isolate it, and people carriers account for 16,161 recorded crashes, 533 of them deadly, 644 deaths, and seven,388 accidents. 417 of these carriers have not less than one deadly crash of their data. Of the ten,333, some 3,460 are nonetheless lively within the federal provider census as we speak, and 6,873 are gone. 2,748 of them present an insurance coverage submitting of file within the federal system from International Hawk itself, together with 131 carriers whose census data are lively as we speak. The insurer has been lifeless for six years. The paper doesn’t comprehend it, and neither does anybody counting on the paperwork.
Each a kind of crash victims who had a declare pending towards a International Hawk insured in June 2020 realized the identical lesson James Richardson realized on the Spirit aspect of my lifeless e book: he gained a $1 million settlement towards a Spirit-insured provider in Illinois and picked up nothing, as a result of the insurance coverage behind it had already been spent. An Illinois appellate courtroom known as it an incredible unfairness and mentioned the regulation gave it no treatment. That’s nonetheless the regulation. Nothing enacted since 2020 screens who might type or run a danger retention group, nothing stops the operator of a failed one from chartering the following one, and nothing offers the household of somebody killed by an RRG-insured truck a greenback of safety when the RRG seems to be a photocopier and a narrative.
Thandi will get his sentence on Aug. 28. The 1,008 truck house owners who paid actual premiums for imaginary protection, the shippers who accepted these certificates, and the folks hit by these vans have already gotten theirs.
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