Fraud defendants plead guilty, agree to pay $826 million
MIAMI — Three people pleaded guilty Tuesday in a multimillion dollar scheme to defraud life insurance policy investors, authorities said.
Raquel Kohler, Ameer Khan and Stephen Ziegler each pleaded guilty in federal court in Miami to one count of conspiracy in connection to fraudulent activities through Mutual Benefits Corp., according to a statement from Miami U.S. Attorney R. Alexander Acosta.
Kohler also pleaded guilty to one count of perjury in connection to false testimony given during a deposition in a civil action brought by the Securities and Exchange Commission, the U.S. Attorney’s Office said.
Under the plea agreement, Khan and Ziegler agreed to jointly reimburse investors $826 million. Kohler, because she joined the conspiracy later, agreed to share in the reimbursement of $471 million of the total $826 million. Each defendant also faces up to five years in prison at a Sept. 25 sentencing hearing.
Kohler was the chief financial officer of MBC, which was closed by federal regulators in May 2004, authorities said. Khan served as president of another company that performed alleged fraudulent services for Kohler. Ziegler was an MBC attorney.
Authorities allege the three schemed to sell investment interests in life settlements. According to authorities, the process involves an investor purchasing an interest in the life insurance policy death benefit of a terminally ill or elderly person. When the insured person dies, the investor sees a profit if the policy benefit is greater than the price paid for it.
The U.S. Attorney’s Office said MBC sales agents “fraudulently induced investor participation in MBCs offering by promising investors ‘safe’ investments in ‘secure’ life insurance policies.”
In addition, the defendants were accused of engaging in deceptive business practices, using investor funds for personal expenses and deceiving regulators about MBC’s management.
Ziegler’s attorney, Fred Haddad, said his client acknowledged guilt to avoid a trial and the possibility of receiving a longer prison sentence.
“Does my client have $800 million? Of course not,” Haddad said. “They’ll get what they can.”
Telephone messages left Tuesday by The Associated Press for Khan’s and Kohler’s
attorneys were no immediately returned.
Source: AP
Other related Viatial Fraud Posts:
Accountants Settle Mutual Benefits Claims
Grifters Fined $5m for Viatical Scam
