Two Face Additional Charges In STOLI Scheme
|Targeted News Service|
Carpenter appeared before U.S. Magistrate Judge
"Carpenter and Bursey stand charged of operating a STOLI life insurance scam that defrauded TARP recipient
The indictment alleges that Carpenter and Bursey, working with insurance agents, caused to be submitted to several insurance providers numerous insurance applications that contained several material misrepresentations, including falsely denying that third-parties were paying the premiums for the insurance, falsely denying discussions about the resale of the policies, falsely inflating the net worth and/or income of the insured, and falsely claiming that the insurance was being purchased for legitimate estate planning-related needs. All applications were signed by Bursey, who acted as trustee of the Trust, which was to be the "owner" of all policies in the Trust. Moreover, the applications purported that the Trust was a bona fide welfare benefit trust under Internal Revenue Code Section 419(e), wherein employers would be making contributions to the Trust in order to fund the life insurance policies for the benefit of certain select employees.
The indictment further alleges that, in truth, no "employer" or Straw Insured ever paid a premium into the Trust, and the premiums were funded by loans, which typically came to the Trust from another company headquartered in
The indictment further alleges that one Straw Insured died within the first two years of the issuance of the two insurance policies on his life. Those policies had been issued in late-2006 and early-2007 based on misrepresentations similar to those described above, specifically that his policies were not being funded by a third party and were not intended for resale. The two insurance policies had a combined death benefit of
If convicted, Carpenter and Bursey face a maximum term of imprisonment of 20 years on each count of wire fraud and mail fraud, a maximum term of imprisonment of 20 years of each count of money laundering and conspiracy to commit money laundering, and a maximum term of imprisonment of 10 years on each count of making illegal monetary transactions.
This case is assigned to U.S. District Judge
This matter is being investigated by SIGTARP, the
The case is being prosecuted by Assistant U.S. Attorneys
This prosecution was brought in coordination with President
About SIGTARP The Office of the Special Inspector General for the Troubled Asset Relief Program investigates fraud, waste, and abuse in connection with TARP.
To report suspected illicit activity involving TARP, dial the SIGTARP Hotline: 1-877-SIG-2009 (1-877-744- 2009).
To receive alerts about quarterly reports, new audits, and media releases issued by SIGTARP, sign up at www.SIGTARP.gov/pages/press.aspx. Follow SIGTARP on Twitter @SIGTARP.
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