Friends of Hal Katz say they lost thousands, call it "betrayal of trust"

Baltimore - They each loaned his company thousands of dollars, but now friends of an infamous Baltimore insurance salesman are fighting him in court.  Records show a group of people who say they fronted huge amounts of money for one of Hal Katz's businesses are going through bankruptcy, trying to get back some of their cash.  You can forget the notion that those fighting are all millionaire investors.  In an exclusive interview, a Katz confidante tells ABC2 many of the investors are regular Joes who simply loaned a friend all the money they saved. 

You know him from TV.  Hal Katz is the insurance pitchman who plays loud music, points at the screen and says he can put you behind the wheel.  But some of Hal Katz's former friends, including Michael Cohen, see him differently.  He says, "I didn't dislike him but i came to think he was not a good businessman."

Cohen, a Baltimore County attorney, may know Katz better than most.  For more than two decades he was the attorney for the Katz Insurance Agency.  He sat on the company's board and says he trusted Katz so much that he invested more than one-million dollars of his family's money in the financial arm of Katz's business, Insurance Payment Plan.  Cohen tells ABC2, "Obviously when you enter into this kind of arrangement with somebody like that, you have to have a certain level of trust.  I'm profoundly disappointed that the trust was warranted."

The breach of trust is something Cohen realized after finding about a state investigation into Katz's businesses last fall.  ABC2 News Investigators first told you back in October, the Maryland Insurance Administration revoked Katz's license to sell insurance after finding he "knowingly committed fraudulent or dishonest business practices".

That state decision involved Katz Insurance, but federal records also show at least two-million dollars missing from Insurance Payment Plan, the lending arm of Katz's company.  Bankruptcy filings list more than a dozen local creditors, including Michael Cohen, who say they're owed money by Katz.  Cohen says, "Everybody I know had some sort of personal relationship with Hal Katz, so essentially it's not just a question of a misappropriation of money, but a betrayal of trust."

And it may be a costly mistake for friends and family of the well-known insurance salesman.  According to Cohen, some of those investors are middle-class people who lost their children's college funds, their retirement money and even their life savings.  Federal court records show the smallest investor put in nearly $50,000, while others invested hundreds of thousands in IPP.

A group of investors filed to get an involuntary bankruptcy declared for IPP.  A bankruptcy trustee was appointed in early December.  It will be the trustee's job to trace the missing money and determine how much is left and can be awarded back to the investors, if any. 

Although Katz did not comment for this story or our previous coverage, citing pending cases, his investors may get to hear from him January 7 th.  Cohen, who hasn't spoken to Katz since the case was filed, wants an explanation, "He's either delusion or sociopathic.  When you take money from people that's not yours, it's not the right thing to do."

 

Print this article Back to Top

Comments

More Investigations

City leaders: Baltimore needs more officers to work security at events without breaking the bank City leaders: Baltimore needs more officers to work security at events without breaking the bank

For every Ravens touchdown and every Orioles inning, there are men and women in blue there to pay witness.  They're not watching the game.  They're watching you.  And no matter who wins, we found the money spent comes at a loss to the department.

Baltimore fighting back against illegal dumpers; harsher penalties to come this fall Baltimore fighting back against illegal dumpers; harsher penalties to come this fall

It's an eyesore, it's unsanitary, and it's a huge problem in Baltimore. The city spends about $17 million cleaning up illegal dumps each year, but the current penalties aren't deterring some people.

Baltimore officer gets 45 days in jail for assault of suspect in break-in of girlfriend Baltimore officer gets 45 days in jail for assault of suspect in break-in of girlfriend's home

A Baltimore City police officer was sentenced to 45 days in jail followed by 18 months of probation and 200 hours of community service for assaulting a man in police custody and then hindering the internal affairs investigation into the incident.

Daycare provider to get new trial after conviction in death of Eastern Shore baby Daycare provider to get new trial after conviction in death of Eastern Shore baby

An Eastern Shore woman convicted in the death of a child in her care will get a new trial thanks to a judge's decision.

Feds say search warrants turned up new evidence in Shawna Gunter case Feds say search warrants turned up new evidence in Shawna Gunter case

In a detention hearing in federal court, prosecutors detailed new evidence in their case against a Severna Park woman accused of posing as a physician's assistant.

Feds: Shawna Gunter, who posed as a physician Feds: Shawna Gunter, who posed as a physician's assistant and treated about 200 patients, indicted

An Anne Arundel County woman is indicted by the feds for posing as a physician's assistant and treating patients.

Many pot tests, but no certainty how much is too much Many pot tests, but no certainty how much is too much

Zero tolerance for pot has been the norm for decades for workplace drug testing, and, in most states, for policing drugged driving. But with millions of Americans now legally able to use pot for either medical purposes or outright, there’s growing demand to know how much is too much to safely drive or perform on the job.

 

 

 

Law enforcement agencies working to find balance in Law enforcement agencies working to find balance in 'thin blue line'

Across the region, police agencies say they don’t tolerate harassment among officers, though there’s no cut and dried solution.

GAO report, victim advocates raise concerns over underreporting of cruise ship crime GAO report, victim advocates raise concerns over underreporting of cruise ship crime

When it comes to cruising, people put a lot of time and energy into researching the prices, amenities and destinations. But according to a recent government report, consumers may not be as informed as they should be about the safety and security on these vessels.

Federal employees are flying high on taxpayers’ dime Federal employees are flying high on taxpayers’ dime

Would you spend more than $16,000 to upgrade to a business class flight? Our investigation found one agency let a top executive use your tax dollars to do just that.