Texas student insurance firm indicted in Va.
By LARRY O'DELL, Associated Press | |
Associated Press |
The grand jury indictment in
Company officials in
The indictment seeks forfeiture of the defendants' property and bank accounts, which were frozen Tuesday by U.S. Magistrate Judge
"This is a step in the process of trying to recoup the losses that we believe we sustained,"
According to the indictment, GM-Southwest is a third-party administrator of health insurance for secondary school and college students. Major insurance carriers provide the coverage, but GMS collects premiums, pays claims and reports the transactions to both the schools and the carriers. The carriers pay GM-Southwest a commission or fee for the service.
The indictment says the company, at Gutschlag's direction, reported accurate figures to the carriers but inflated claims numbers to the university over a seven-year period beginning in the 2003-2004 academic year. It says the university's risk manager retired in 2010, and that employee's successor questioned the accuracy of EM-Southwest's reports.
Owczarski said an internal review of the program determined the university was overcharged. He said university officials reported the findings to the
Aetna now administers the university's student health plan, Owczarski said.
The indictment charges the defendants with 41 counts of mail fraud, seven counts of wire fraud, five counts of money laundering and one count each of racketeering, mail fraud conspiracy, wire fraud conspiracy and money laundering conspiracy.
U.S. Attorney
No hearing dates have been scheduled.
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