Default! The man who scammed golf prizewinners across the country
Special reporting by Chris Johnson
It took at least a half-dozen fortuitous events for Matt Ramsay to experience his most memorable day as a golfer.
First, a friend of Ramsay's had to win a radio call-in contest in October 2011, the prize for which was two spots in a charity golf tournament benefiting the Prostate Awareness Research Foundation. Second, that friend had to choose Ramsay, an electrician from Vancouver, Wash., as his playing partner, and Ramsay's wife, Jennifer, had to OK him going. She had given birth to their first child six weeks earlier and the sleepless nights caring for an infant were piling up.
At the tournament at Heron Lakes Golf Course in Portland, Ramsay had to make the impulse decision to pony up $10 for a spot in a putting contest on the practice green. He then had to make one of three putts from 50 feet and place another within a few feet of the hole to qualify for the finals, in which he would have one attempt at a 67-foot putt. If Ramsay sank that he would win $10,000.
Finally, Ramsay had to make the putt. It broke to his left and was downhill, but Ramsay read it perfectly and nailed it. The video of him celebrating is priceless. He took a sweeping victory lap around the green -- "I thought about jumping the pond," he says -- and then chest bumped a guy he had just met that day, and hugged the friend who invited him to the tournament, who was joyfully screaming: "You son of a bitch! You son of a bitch!"
Unfortunately, Ramsay's good fortune ended there.
Like many other jubilant prizewinners at golf events around the country, Ramsay would learn that he was the victim of a scam perpetrated by Kevin Kolenda, now 56 and a resident of Norwalk, Conn. Since at least 1995, Kolenda had been selling insurance without a license in several states to people seeking indemnity for hole-in-one and putting-contest prizes. On the occasions when a winning shot occurred -- it happens more often than people think -- Kolenda often did not pay. His victims have included the charities that hosted tournaments, including the Marine Corps League and the D.A.R.E anti-drug campaign, and an untold number of prizewinners like Ramsay. Kolenda ran his simple scheme so habitually that he has been convicted of felony larceny and fined $5.9 million in Connecticut, and he has been charged with crimes or sanctioned by insurance regulators in numerous other states.
"After a few weeks not hearing back from [Kolenda], I went on the Internet and started seeing all these things about him [in Connecticut]," Ramsay says. "I pretty much knew then that I wasn't going to get the $10,000. I went from being happy to, well, pretty depressed."
There are an estimated 50,000 tournaments every that feature hole-in-one or putting contests, but the premiums paid to insure prizes are usually small. To indemnify a $10,000 hole-in-one prize, an insurer is likely to require only $250 from the client. It is a volume business, dominated by three or four companies, the most reputable of which are licensed in every state in which they sell insurance and which partner with a large insurance company to limit their risk.
"Everyone starts from the standpoint that there are never any winners, but we've had years when we've had multiple winners on the same hole. One year we had two $100,000 winners 12 shots apart," says Doug Burkert, president of National Hole-in-One, which is based in Richardson, Texas, and has been operating since 1981.
Until Kolenda got into the industry, fraud was rare. Occasionally, a golfer or a tournament organizer filed a false claim, but there are stipulations in the policies -- including that a witness must be stationed at every prize hole -- that make scammers easy to catch.
Insurers sometimes challenge the legitimacy of a hole-in-one, most often because the hole played shorter than what was agreed upon or because the winner was allowed to play the hole multiple times. But very few claims are denied. "Tournament directors sometimes make innocent mistakes," says Mick Luckhurst, a former Atlanta Falcons kicker and the CEO of American Hole 'n One, an agency based in Buford, Ga., that has been in business since 1986. "But, overall, this is a very honest business. That is why what [Kolenda] did was so surprising."
Kolenda's business was initially called Golf Marketing. He didn't draw serious attention from authorities until around 1999, when a former associate informed the Connecticut Insurance Department (CID) that Kolenda was selling insurance in the state without a license. CID attorney Anthony Caporale investigated and learned that lawsuits had been filed against Kolenda in Georgia, Iowa and California. In Georgia, a court found that Kolenda had failed to cover an $80,000 Mercedes-Benz that had been put up as a hole-in-one prize. In Iowa, he hadn't paid $10,000 to the winner of a putting contest. In California, a court ruled against him after he failed to cover the $100,000 won by a UCLA student who made a 35-yard field goal at halftime of a Bruins football game at the Rose Bowl, a rare instance when Kolenda stepped outside of golf.
As Caporale investigated further, he learned that Kolenda was operating his business -- also known over the years as Golf Marketing Worldwide LLC, Hole-in-Won.com Worldwide, among other names -- out of his mother's house in Norwalk. It was essentially a one-man operation, though Kolenda sometimes hired college-age employees to man the phones and computer. He solicited clients via fax and email blasts, while others contacted him through his website, which boasted "$10 million paid out over 25 years."
By 2001, Caporale had compiled enough evidence of Kolenda selling insurance in Connecticut without a license to file a complaint, which resulted in Kolenda being fined about $9,000 in 2002. He was also barred from selling insurance in the state. "After that, I would check with people and it seemed as if he was no longer entering into contracts in Connecticut, but he was. I also kept getting complaints from people in other states," Caporale says. "I felt powerless to do anything because I had limited jurisdiction."
By 2007, Caporale had collected more than 40 complaints against Kolenda from around the country, and he urged Connecticut's Chief State's Attorney to investigate further. It took three years, but the State's Attorney finally filed charges against Kolenda, and a year later he pleaded no contest to two felony charges, attempted larceny and larceny. He received a two-year suspended sentence and three years probation. Meanwhile, the CID fined Kolenda $5.9 million -- the highest penalty Caporale can recall. But Kolenda's attorney claimed his client was insolvent.
"At no point did he stop selling insurance," Caporale says. "He didn't even flinch. Once, when [police] served a search warrant on his home, he was on the phone in another room making deals as they searched. I have never encountered anyone as malicious and deliberate ... It was so frustrating. It seemed like there was nothing we could do civilly or criminally to stop him."
Robert Camastro, the owner of a Mercedes-Benz dealership in Danbury, Conn., bought insurance from Kolenda's company 24 times over a two-year period, according to an affidavit filed by the State's Attorney. The final transaction came in June 2009, when Camastro paid Kolenda $1,925 for a policy to insure a $43,585 car that he put up for the Mayor's Cup, a charity golf event in Danbury. On the 5th hole of that tournament, a Naugatuck resident made a hole-in-one. Nearly six months later, when Camastro's claim still hadn't been paid, he did an Internet search of Kolenda's company and learned that Kolenda had been sanctioned by the CID.
Camastro's experience highlights how Kolenda was able to operate for so long. First, no one knew they were being scammed until a hole-in-one or other winning shot occurred; Camastro would have said he was content with his coverage 23 times. Second, clients rarely did a background check on Kolenda or his company before handing over their money. A simple Google search would have revealed, at the least, Kolenda's $5.9 million fine by the CID.
"I hate to say this, because to some people $250 is a lot of money, but for that much money you don't think to do a lot of background checking," says Evan Denhart, who organized the charity event and putting contest that Matt Ramsay won in 2011 in Portland.
Like many other tournament organizers who bought insurance from Kolenda's company, Denhart and Camastro were on the hook for the prizes. Some winners, particularly those who won at a charity event, forfeit their prizes or take a reduced amount. Denhart says that Ramsay graciously agreed to accept only $1,500. "You can pursue [Kolenda] legally, but you are going to burn through $10,000 in legal costs pretty quickly and there is very little chance you are going to get the money," Denhart says.
Kolenda's crimes may appear victimless, but nonprofit organizations have suffered financially. "Suddenly a charity that might have made $2,000 to $4,000 on an event owes $10,000 instead," says Luckhurst of American Hole 'n One. One bad experience can also scare off businesses that support charities. Camastro says he still puts up cars as hole-in-one prizes, but says that he also does more homework on his insurer. Denhart isn't so brave. "I'm gun-shy about doing another putting contest," he says. "For [the 2012] tournament we did a raffle instead."
In September 2012, Caporale of the CID walked across his office and high-fived a colleague. A typical case for Caporale lasts about a year; he had been tracking Kolenda for more than a decade. Finally, he believed there had been a break in the case. That month, Kolenda was arrested in Norwalk on a warrant in Washington. Insurance regulators in that state (and later Montana) had taken the extraordinary step of filing felony charges against an out-of state resident for violating insurance laws. Most states handle insurance issues with fines or administrative actions, but Kolenda was considered such a menace that in Washington he was charged with five felonies related to insurance transactions.
"The hope was that this would finally put him out of business for good," Caporale says.
Kolenda was extradited to Washington, where he had a long history of refusing to pay prizes. In 2003 and '04, he failed to pay winnings of $10,000 and $50,000, respectively, for which he was served with a cease-and-desist order banning him from selling insurance in the state. Kolenda violated that order, and he was eventually fined $125,000, which he never paid. He also reneged on a $25,000 prize won at a tournament in Snohomish, Wash., in 2010. Later, in Montana, Kolenda was charged with felony fraud and for selling insurance without a license, a misdemeanor, after he failed to make good on an $18,000 hole-in-one prize in 2010.
In the past, Kolenda has played off his non-payment of winners as a misunderstanding or a legitimate denial of a claim. In 2005, he told the San Diego Union-Tribune: "An issue may come up, but again, these are far and few between. It's less than 1 percent of our business. Every other company has them, too, so you can't say it's only us. That's not fair to us ... We are the New York Yankees of the industry. We have set the standard on payments and claims."
In 2009, he told the Hartford Courant: "I have a 100 percent clear record in the state of Connecticut [of paying on contracts]. The state insurance department is trying to make some exorbitant headline splash."
As authorities in Montana and Washington moved to prosecute Kolenda, a few cryptic sentences were posted on Hole-in-Won.com:
Golfers Fabricating Accomplishments!
Events and Golfers Taking Liberties with the Rules!
Tournament Director Outlandish Foul-Ups!
See Lawyers/State Officials/Journalists get Hoodwinked!
It is unclear what all that means, but the meaning of what happened is unmistakable: Last October, Kolenda pleaded guilty in Washington to three felonies -- two counts of selling insurance without a license and one count of first-degree theft -- and was ordered to pay $15,550. Later, he was sentenced to 86 days in jail and given credit for time served. Kolenda also pleaded guilty to the misdemeanor charge of selling insurance in Montana without a license and was ordered to pay $10,000.
In Montana, Kolenda's victim was Troy Peissig, who scored an ace on the 12th hole of the Missoula Country Club a few months after he and his wife welcomed their first child. The $18,000 prize was a godsend for his family, Peissig thought at the time, but then he did some research on Kolenda after Hole-in-Won denied the claim. It was then that he figured, "I'm never seeing any of that money." He wouldn't force the tournament organizer to pay it, he says, as the proceeds from the event went to charity.
After Kolenda pleaded guilty in Montana, Peissig was surprised when a few weeks later he received a check for $10,000. "It was less than the $18,000 I won but I was just floored we got anything given his history," Peissig says. "A guy like that, you know he has money. He's been running this scam for so long, you know he has it somewhere. I just hope that, wherever he is now, he is finally done scamming people."
On the Saturday before Christmas last year, Kolenda was at his penthouse apartment at a posh residential complex in Norwalk. Up on the eighth floor, Kolenda's luxurious apartment contains three bedrooms, and the building offers sweeping views of the Norwalk River and Long Island Sound. In August 2007, the apartment Kolenda leases sold for $1,420,000.
Kolenda buzzed an SI.com reporter up to his floor but wouldn't allow entry into his residence. Kolenda cracked open his door wearing blue jeans, a white T-shirt and a shark tooth pendant necklace. As he talked, he looked down often, in the direction of doormat with "Walk This Way" printed on it along with the familiar winged emblem of the band Aerosmith. Kolenda is a fan of classic rock; he also had a stocking with the Rolling Stones' wagging-tongue logo hanging from his door. On his personal website it stated that he has seen the Rolling Stones live more than 100 times and that his life motto (of sorts) is: "Not a Rock Star at all ... just try to live like Won."
In 2012, after he got out of prison in Connecticut, Kolenda reported to Norwalk police that some items had been stolen from his apartment. They included: $10,000 in rare coins, a $6,000 Rolex watch and two bottles of Cristal.
Kolenda declined to discuss the many charges against him or his convictions and refused to elaborate on the contents of the book that postings on his website said he is writing about the insurance industry. (Tentative title: Behind Blue Eyes, which is the title of a song by The Who.) The prospective book, it stated on his website, is "guaranteed to blow away the largest political scandals of recent years," and will possess revelations that will "SHOCK EVERYONE" and which will "Make Elliot Spitzer and Anthony Weiner look like Choir Boys."
"I wish I could [talk], but the lawyers told me not to," Kolenda says in the doorway to his apartment. "I'd love to have my side of the story come out, because it's totally going to flip everything on its head. Just got to sit tight. Yup."
Kolenda's personal website offered page after page of defenses. It had postings titled: "The Clueless are tryin' to crucify me," and "The man, myth & legend," among others. Most pages were dedicated to refuting some charge against him, though not convincingly. The postings were mostly rants against politicians, journalists and industry competitors or boasts about his achievements and knowledge, some of which have nothing to do with golf or insurance. A long missive on the site's front page included the claim: "Kevin Kolenda denied Lance Armstrong's peoples accomplishment / feat 10 years BEFORE everyone else did!"
Kolenda's website included an advertisement and link for Hole-in-Won.com, the site Kolenda used to bring in clients. On that site, it stated: "Hole-In-Won.com was sold in December 2008 and is under new management. Kevin Kolenda is no longer the owner." However, Kolenda sold insurance after December 2008, according to authorities in Connecticut, Washington, Montana and elsewhere. Also, Hole-in-Won.com features a page titled "the REAL Hole-in-One Claims Industry Story," which includes assertions similar to those posted on Kolenda's website. The line about knowing about Lance Armstrong's deception can also be found on Hole-in-Won.com. That site's homepage also pays homage to Kolenda with the line: "We Respect what he accomplished & built!"
At his apartment, Kolenda said that he no longer operates Hole-in-Won.com and contends that he sold it years ago. He refused to disclose who owns it now. "[The lawyers] say I can't," he says.
Two listed addresses for the business, one in Connecticut and one in New York, are United Parcel Service stores. David S. Klein is named as the owner of the business on a filing with the Connecticut Secretary of State, and there is a person with that name who is friends with Kolenda on Facebook. Further, on David S. Klein's Facebook page he lists himself as "Owner-Operator at Hole-in-Won.com."
Kolenda's victims and those who have investigated him over the years are hopeful that Kolenda is finally out of business. Felony convictions like those he garnered in Washington would scare a lot of people straight, yet Kolenda has for more than 15 years continued to operate despite convictions, fines, lawsuits, cease-and-desist letters and more. It makes the victims wonder if he has truly been put out of the business or if he has he just found a new batch of unsuspecting clients.
Kolenda gave no hint during the conversation in the hallway outside his apartment, but on the homepage of his personal website it stated that Kolenda has "continued in establishing" contests "in the US and worldwide." It also proclaimed, in what could be the truth or just another outlandish boast, that he is, "the largest prize provider in the Caribbean, China, Hong Kong, Russia, Norway Central & South America as well as many other markets around the world."
An SI.com reporter called phone numbers listed on Hole-in-Won.com more than 40 times over a 10-day period. Only twice was SI.com able to speak with someone. This week, the person answering the phone, who identified himself only as Tim, declined to reveal the identity of Hole-in-Won's owner. In early January, the person answering the phone sounded like Kolenda, with the same casual inflection and frequent use of both "you know" and "uh" between words and a distinct use of "yup" at the end of sentences. Asked his name, the person identified himself as Alex Harris. (SI.com could not find anyone by that name affiliated with Hole-in-Won.com in public records, nor is anyone by that name friends with Kolenda or Klein on Facebook.) That person said that Klein was the owner of Hole-in-Won.com but that he was travelling "as far as I know [until] the middle of February." Asked if Kevin Kolenda was still part of the company, the person said: "No. Kevin sold the company almost four, five years ago. Yup."