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Mission Viejo Woman Gets 16 Months for Inflating Fire Insurance Claims

Her agreement to plead guilty dropped the two arson-related charges against her.

Patch file photo.Fauzia Lodhi pleaded guilty last May to one count of wire fraud and admitted to filing inflated claims with State Farm Insurance from 2006 to 2007. Patch file photo.
Patch file photo.Fauzia Lodhi pleaded guilty last May to one count of wire fraud and admitted to filing inflated claims with State Farm Insurance from 2006 to 2007. Patch file photo.
A federal judge in San Jose sentenced a 53-year-old Mission Viejo woman to 16 months in prison for collecting money on an insurance company after allegedly setting fire to a Mountain View business in 2006, according to the U.S. Attorney's Office. 

U.S. District Court Judge Lucy Koh imposed the penalty Wednesday on Fauzia Lodhi, who pleaded guilty last May to one count of wire fraud and admitted to filing inflated claims with State Farm Insurance from 2006 to 2007, according to U.S. Attorney Melinda Haag. 

Koh also ordered Lodhi to serve three years of supervised probation, pay State Farm $54,896 in restitution equal to the payments Lodhi received and surrender to federal prison authorities on July 30, Haag said. 

In her agreement to plead guilty to one count of mail fraud, prosecutors agreed to drop 12 other felony charges lodged against Lodhi by a federal grand jury, including two counts related to arson. 

The U.S. Attorney's Office in San Jose prosecuted the case based on an investigation by the federal Bureau of Alcohol, Tobacco, Firearms and Explosives and the Mountain View Police and Fire departments, according to Haag.

Lodhi was indicted in 2011 by the grand jury on 13 felony counts, including one count of wire fraud, 10 counts of mail fraud and one count each of malicious use of fire and use of fire in the commission of a federal felony, according to the court records. 

In the indictment, the grand jury alleged that Lodhi on April 17, 2006 signed a business insurance policy with State Farm to insure her postal and shipping business, Postal Express, located at 801 W. El Camino Real in Mountain View. 

In her policy, Lodhi submitted falsely inflated statements of revenue and the value of the property in her business, such as listing personal loans as business income, the grand jury reported. 

On May 17, 2006, an arson fire erupted in the building housing Lodhi's business that was later determined to have started inside the Postal Express, according to the grand jury. 

Jurors concluded that Lodhi, after acquiring insurance from State Farm that covered fire damages, "intentionally caused the setting of a fire inside the building housing Postal Express in order to collect on the inflated insurance policy." 

The day after the fire, Lodhi filed claims with State Farm under her policy "based on the falsely inflated invention and revenue statements," for business income and personal property losses, the grand jury stated. 

Lodhi then accepted, by U.S. mail, 11 insurance checks from State Farm, in amounts ranging from $1,228 to $15,000, from June 2, 2006 to June 1, 2007, totaling $54,896, the panel reported. 

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