More than two years ago, I wrote that Ricky McGraw was going to become a footnote in the history of Florida insurance law one way or the other. At the time, Tower Hill was accusing McGraw and SFR Services of widespread fraud, Florida insurance investigators had criminally charged him, and the litigation seemed destined to provide some important lessons about contractors, inflated estimates, insurance fraud, and the increasingly blurry line between civil insurance disputes and criminal prosecutions.
I may have underestimated this story. The footnote keeps getting longer. At some point, a long enough footnote becomes a chapter.
McGraw and SFR have now filed another federal lawsuit, 1 this one arising specifically from the criminal prosecution involving the Rookery Pointe claim. It is different from the much broader RICO complaint filed in August. That earlier lawsuit tries to connect years of settlements, Tower Hill’s civil litigation, communications with the Department of Financial Services, the criminal prosecution, and SFR’s eventual demise into an alleged racketeering enterprise. The new complaint is much narrower. It asks a question a jury can understand without needing a whiteboard and three pots of coffee:
Why was Ricky McGraw criminally prosecuted in 2023 over a claim that the complaint says Florida investigators and prosecutors had already reviewed in 2021 and concluded did not involve a crime? That is a major theory of this new complaint.
The well-written, easy to follow complaint alleges that the earlier investigation involved the same Rookery Pointe claim, the SFR estimate, subcontractor pricing, and other claim information. It says the State Attorney’s Office concluded in October 2021 that the matter was a civil pricing dispute and that probable cause for a criminal prosecution did not exist. Then, according to the new complaint, everybody kept going.
McGraw alleges that Tower Hill personnel, its lawyers, and DFS investigators continued communicating, strategizing, and pursuing a criminal case until a second investigation resulted in charges against him in 2023. The complaint specifically alleges that the second investigation did not adequately disclose the disposition of the first one. Those allegations, if proven, present a much different case from simply arguing that Tower Hill was wrong about the amount of a roof estimate.
The complaint also makes some allegations that deserve attention because they go directly to how the criminal case was built. It alleges that independent estimates existed that were as high as, or higher than, SFR’s estimate and that another estimate prepared by Catastrophe Response Unit was “in line” with what SFR was claiming. McGraw alleges that these materials were not fairly presented in the criminal investigation.
Even more curiously, the complaint alleges that January 2024 emails show investigator Rebecca Prince-Swift discussing that CRU estimate and recognizing that it was closer to SFR’s sworn proof of loss.
Readers of this blog know that last week I wrote about another set of emails in which Tower Hill asked DFS to delete previously transmitted information so it could supply replacement files after allegedly privileged material was removed. The investigator replied that she was “deleting all the information received thus far.” I said then, and still say now, that there may be a perfectly legitimate privilege explanation for that exchange.
But the new complaint adds another piece to the puzzle. It alleges that the complete file from the 2021 investigation was copied onto a CD and that DFS later lost or destroyed it. According to the complaint, the State and Glen Clasen stipulated that the CD was gone.
So now we have an old investigation allegedly finding no crime, a missing investigative file, subsequent emails about deleting and replacing information, allegedly omitted estimates, and ultimately a prosecution that the State abandoned shortly before trial. Sherlock Holmes would probably ask for another cup of coffee.
Still, anybody reading only McGraw’s complaint would be making a mistake if they concluded the case is already over. From my view, there is a rather large elephant sitting in the courtroom.
In May 2023, Circuit Judge Michael McHugh ruled against SFR in the Rookery Pointe litigation and found that material information concerning SFR’s subcontractor arrangement had been concealed or misrepresented. He set aside the appraisal award and found the appraisal process had been tainted by fraud. SFR vigorously disputed those findings, but they existed before the later criminal charges were filed. I expect the defendants in this new federal lawsuit will put that ruling front and center.
Their likely argument will be that this was not simply the same case that prosecutors rejected in 2021. After the earlier investigation ended, a Florida circuit judge made significant findings concerning fraud in the very same Rookery Pointe matter. They will likely contend that this provided a substantial new reason to investigate further. My initial gut opinion after reading the complaint is that this seems to be a serious defense McGraw and his attorneys may have to answer.
The new complaint spends considerable time arguing that investigators blurred the distinction between SFR, the company, and Ricky McGraw, the individual. It alleges he did not prepare the estimate, hire or pay the subcontractor, negotiate the claim, or personally receive Tower Hill’s money. It further alleges that Swift testified she had no evidence McGraw personally drafted or submitted the particular estimate at issue.
There is a particularly important factual dispute lurking inside all of this concerning the sworn proof of loss. The criminal allegations asserted that McGraw signed it. The new civil complaint says he did not sign or authorize it. Somebody is going to have to prove what actually happened.
Another interesting allegation concerns the supposed complainant who started the second investigation. The lawsuit alleges that a Rookery Pointe homeowner, Joe Namath, was identified as the person making the complaint but later testified that he never initiated a DFS investigation and had not authorized the use of his name.
The complaint even ventures into the political atmosphere surrounding Florida property insurance. It alleges that Nemeth and Swift discussed the “political climate” in connection with the criminal charges. The allegation caught my eye because Florida spent years blaming fraud, contractors, roof claims, assignments of benefits, and litigation for the state’s property insurance problems. McGraw’s arrest was publicly announced against that backdrop. But context is not proof of motive. Until the actual communication about the “political climate” is produced and read in context, nobody should jump from an allegation to a conclusion.
I caution everyone to remember that a complaint is an accusation written by lawyers representing one side. It is not evidence. Tower Hill, its attorneys, and the individual investigators are entitled to defenses, explanations, privileges, and immunities that have not yet been fully presented. They should be presumed innocent of wrongdoing unless competent evidence proves otherwise.
I said essentially the same thing years ago when Tower Hill filed its massive fraud allegations against McGraw. Allegations are easy to make. Proof is harder. Courts are where we are supposed to find the difference. That principle has not changed simply because the shoe is now on the other foot.
What has changed is the amount of information becoming public. This new lawsuit is not simply a repeat of McGraw’s RICO case. It places the criminal prosecution itself under the microscope. The 2021 investigation, the 2023 reopening, Judge McHugh’s intervening ruling, the allegedly missing evidence, the estimates, the sworn proof of loss, the identity of the complainant, and communications among Tower Hill, its lawyers, and DFS are now likely to receive considerably more scrutiny.
Perhaps discovery will demonstrate that DFS had perfectly sound reasons to reopen the matter, that the allegedly missing evidence changes nothing, and that the criminal prosecution was supported by probable cause when it commenced. Perhaps discovery will show something very different. That is why lawsuits have discovery rather than applause meters.
For those who have followed this saga from the beginning, I would not throw away the old footnote just yet. But leave several blank pages after it. This story seems determined to keep writing itself. More to come.
Thought For The Day
“Floridians deserve full transparency and accountability.”
—Florida Insurance Commissioner Michael Yaworsky, 2025. Yaworsky made the statement while discussing OIR’s review of potentially improper insurer claim denials and added that suspicious insurer activity should result in accountability. A lot of us are still waiting for full transparency.
1 SFR Services v. Tower Hill Ins. Group, No. 0:26-cv-62568 (S. D. Fla. 2026).
