Ex-Lake Forest insurance broker accused of taking payments but leaving clients uninsured

Apr. 30—A former Lake Forest insurance broker charged this week with more than 90 felony counts after authorities say she collected payments from 32 customers over eight years yet left them uninsured, the California Department of Insurance said.

Karen Marie Dondanville, 53, of Mission Viejo faces dozens of charges including grand theft, insurance fraud, financial elder abuse, and forgery.

She was arrested on Friday, April 23, and, court records show, on Monday, April 26, she pleaded not guilty to or denied the counts.

Authorities say her scheme resulted in her collecting $183,047 in stolen premium payments.

Insurance department authorities received multiple complaints from customers about Dondanville while she was doing business under the names Streamline Insurance Services and Broadstreet Insurance Services.

Dondanville tried to cover up the fraud by giving clients phony insurance documents as proof they were covered, the agency said.

Earlier this year, the Department of Insurance said, it issued cease-and-desists orders to Dondanville after receiving complaints from customers when she was doing business without a license, which had been revoked in November 2019.

Dondanville billed yet didn't fully pay insurance companies, resulting in many policies lapsing for nonpayment, the insurance department said. She also submitted fraudulent documents to insurance companies, diverting premium refunds to herself, the insurance department said.

"This left her 32 victims with more than 10,000 collective days without insurance coverage, exposing them to the danger of substantial uninsured losses," the department said in a statement.

In one case, she is accused of creating fake insurance documents charging a homeowner $2,800 but the true cost of the policy was $900 and she paid the insurance company only $400.

Another customer unknowingly without coverage experienced approximately $100,000 in uncovered losses, the Department of Insurance said.

The Orange County District Attorney's Office is seeking restitution, with a criminal complaint showing prosecutors have calculated the figure at $335,349.

Insurance authorities remind consumers to verify that their insurance agents are licensed and can do so online on the California Department of Insurance's website.

The department asks those who believe they are a victim of an agent or someonce acting as one to file a complaint with the department.

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