Fla. Lawyer Convicted In $1B Mutual Benefits Fraud Case
|By Jay Weaver, The Miami Herald|
|McClatchy-Tribune Information Services|
The 12-person jury found Livoti guilty of conspiring to commit fraud and money laundering, along with two other counts. But the jury found the lawyer not guilty of 19 other fraud charges.
U.S. District Judge
"Am I disappointed? Crushed," said Livoti's defense attorney,
Livoti was the only defendant in the long-running prosecution of the Mutual Benefits case to go to trial, with 10 others, including employees, a lawyer and a doctor, pleading guilty in recent years.
The once-high flying
Livoti, charged with conspiring to commit wire fraud and money laundering along with related offenses, played the role of trustee who controlled Mutual Benefits' investment accounts. He was accused of using newer investors' money to pay the premiums on older life-insurance policies to sustain the racket for years, Assistant U.S. Attorney
But Livoti's defense attorney, Hirschhorn, countered that the prosecution miscast his client's part, saying he was actually kept in the dark about the investment scam by Mutual Benefits executives who exploited him to line their own pockets. He said Livoti's principal role was to ensure that the premiums on policies were paid up so that they would not lapse and investors could be made whole when beneficiaries died.
Hirschhorn told the 12-person jury that his client was innocent during closing arguments in November. Before standing trial, Livoti has been better known as the general counsel for the
The only remaining defendant in the Mutual Benefits' case is former top executive,
Steinger has tested the patience of U.S. District Judge
In September, Steinger was supposed to face trial with his brother,
Steiner, who spells his last name differently, pleaded guilty before to two wire-fraud conspiracy charges in separate criminal prosecutions, entailing duping life-insurance investors in the Mutual Benefits case and health-insurance companies in another case.
Sentenced recently to 15 years in prison on a related money-laundering conviction, Steiner now faces up to 20 years that would run concurrently with that term.
According to prosecutors, Mutual Benefits repeatedly lied to investors, who paid out discounted lump sums to beneficiaries dying of terminal illnesses for the right to collect on their benefits at full face value.
In a factual statement filed with his plea agreement,
"Investors were falsely told by [Steiner] . . . and by others that as many as 80 percent of all MBC policies matured on time or early," according to the statement filed in court.
Steiner "and others represented that life expectancies on MBC policies were determined by qualified and independent medical doctors who evaluated the health of the insured and spoke or consulted with the insured's treating physician," the statement said.
The statement noted that a doctor named
Others who have been convicted in the Mutual case are:
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