Woman in firefighter murder case had insurance payouts for blazes, analysis shows

Thu Hong Nguyen has operated five nail salons dating back to 2006 and each one them had some kind of catastrophic event — usually a fire — that closed them down for good.

And in four cases, there has been an insurance payout, usually for much more than the purchase price of the business.

It’s a pattern that prosecutors emphasized Thursday in the fourth day of Nguyen’s arson and murder trial for the 2015 fire that resulted in the deaths of two Kansas City firefighters.

In all, Nguyen has benefited from $267,843 in business and personal insurance payments over the last dozen years, according to an analysis by Nikki Poirier, a forensic auditor specializing in arson for the Bureau of Alcohol, Tobacco, Firearms and Explosives.

Nguyen has operated at least five nail salons from Texas to Grandview to Lee’s Summit to Kansas City. Only one has been in her name.

With the others, the signatories have included her son and her boyfriend. She ran each of them but she usually didn’t receive a paycheck or file a W-2 tax form. Yet the proceeds of each business appear to have been used for personal expenses, Poirier said.

Then there would be a fire or a burglary and an insurance claim.

“She would subsequently use these payouts to purchase a new company and start over,” Poirier testified.

But the latest setback for one of Nguyen’s salons was a catastrophic fire that destroyed a commercial and residential building in the 2600 block of Independence Avenue on Oct. 12, 2015. Firefighters John Mesh and Larry Leggio were killed and two other firefighters seriously injured when a brick wall collapsed on them while they fought the blaze from an alley.

Two Kansas City firefighters were killed when an exterior brick wall collapsed on them.

Investigators pinpointed the origin to the storeroom of Nguyen’s LN Nails and Spa on the first floor and charged her with setting the fire. After Nguyen was arrested, according to testimony at her trial, she admitted guilt to a fellow detainee. She allegedly said she didn’t expect things to go wrong and that she had done it before and had never been investigated.

Here’s what Poirier found in her investigation:

Nguyen and her ex-husband purchased a salon called PS Nails in Uvalde, Texas, in 2006 for $27,000. They operated for 16 months without business insurance. Then they took out aThe insurance payout was $30,286.

The AV Nails salon in San Antonio, also associated with her ex-husband, was purchased for $38,000. It operated for just four months before it was destroyed by fire. The insurance payout was $62,344.

Perfect Nails in Grandview was purchased for $15,000 in Nguyen’s son’s name. After eight months of operation the insurance was increased to $30,000. Two days later a burglary was reported. The insurance payout was $41,855.

Nails USA in Lee’s Summit was purchased for $20,000, also in Nguyen’s son’s name. It was damaged by fire on July 25, 2013. The insurance payout was $51,873. (More on that fire below.)

LN Nails and Spa was purchased for $20,000 in Nguyen’s boyfriend’s name. She has said she contributed $10,000. According to Nguyen, the arrangement was she kept all the cash receipts and he got the credit payments. She also got a 40 percent share of what her one employee made.

In January 2015 there was a relatively small fire in a vacant apartment directly above LN Nails, which received water damage when firefighters extinguished it. The insurance payout was $40,000.

There might have been another big insurance payout when the salon was destroyed by the deadly October 2015 fire. But after an initial $2,000 payout to Nguyen’s boyfriend, he withdrew the claim on the advice of his attorney, Poirier testified.

In all, Poirier found a total of 14 insurance claims associated with Nguyen, including personal insurance claims such as an auto accident and auto theft.

One was for a fire in her brother’s house, where she was living for a time. Unbeknownst to the brother, Poirier said, Nguyen had herself added to his homeowner policy and later named herself head of household. She received an insurance claim for $9,650.

Over the years, Poirier said, Nguyen has overstated business assets for insurance purposes and understated them for other purposes. She has received about $33,000 in food stamp assistance.

In cross-examination, defense attorney Molly Hastings said the government can’t say with assurance that Nguyen had access to or benefited from all the insurance money.

She also noted that the payouts came from some large insurers like Farmer’s, State Farm and American Family. Hastings said those companies have the ability to investigate fraudulent claims.

“A major insurance company is savvy enough to figure out when somebody is pulling a scam,” Hastings said.

Assistant Jackson County Prosecuting Attorney Dan Nelson countered that sometimes it is cheaper for an insurance company to pay a claim than to fight it in court.

Finding a pattern

Thu Hong Nguyen-mugshot
Thu Hong Nguyen

The first investigation into the fire at the Lee’s Summit nail salon concluded it was accidental.

A second investigation concluded the cause was “undetermined.”

A third investigation concluded the fire was deliberately set.

Nguyen’s arson charge for that pales in comparison to the murder charges she also faces. But if prosecutors are correct, it shows a pattern of behavior.

Nguyen allegedly started a fire in her nail salon on Independence Boulevard just before locking up for the night and being the last one out.

Similarly, she allegedly started the fire at her nail salon on Ward Road in Lee’s Summit just before locking up for the night and being the last one out.

Nobody died in that fire. But after Nguyen was charged in the Independence Boulevard fire, a special agent at the ATF decided to take another look at the Lee’s Summit case.

Agent Ryan Zornes talked to witnesses who had not been interviewed in the previous investigations. And he requested laboratory tests that he and other fire investigators say rule out any hypothesis other than that the fire was deliberately set.

Nguyen decided to close early that day and drove her two employees home. Melissa Vaughn, who had been her last customer, saw them leave. She had remained window shopping at the strip mall while her tires were being changed.

Strolling past the now-closed nail salon, she was shocked to notice high flames at one of the work stations. It was Nguyen’s station.

Vaughn called 911 and the Lee’s Summit Fire Department quickly subdued the fire. Shawn Burgess was the fire investigator for the department on the case.

It was clear the fire originated inside a cabinet at the work station and then burned up and out.

Burgess found the remains of a power strip that had been fused by the heat to a nail-polish removal appliance. He had extensive training in fire science but this was his first case in a commercial establishment. He found numerous code violations in the shop such as power strips “daisy chained” together and spliced electrical cords.

Burgess concluded the fire was possibly caused by electrical failure. He classified it as accidental.

State Farm, which insured the contents of the nail salon, hired its own investigator. Kirk Hankins looked at the same evidence Burgess had. He was not able to determine a cause, but he recommended State Farm hire an electrical engineer to further examine the power strip that was found in the cabinet.

For whatever reason, that didn’t happen.

But in December 2015, Zornes became interested in the timeline of the case. By various accounts, it had been 10 to 15 minutes between the time Nguyen and her employees drove away and when Vaughn reported seeing flames. What scenario would produce a fire like that so quickly?

The power strip had been a suspect. The original, destroyed one was no longer available but others of the same make and model could be tested.

The ATF Fire Research Laboratory in Maryland recreated the cabinet and desk that had been destroyed in the Lee’s Summit fire and did several tests to see if that could be duplicated through an accidental ignition by a malfunction of the power strip. They found it could not.

But the cabinet at the nail salon had acetone in it, a flammable liquid commonly used in removing nail polish. Further tests found that, with an intentional ignition and with or without acetone, flames like those seen by Vaughn could easily be produced within 10 minutes.

Zornes said that confirmed his hypothesis that the Lee’s Summit salon fire was intentional.

Defense attorney Hastings noted that none of the lab’s procedures tested malfunctioning power strip with acetone or other flammable liquids found in salons.

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