Judge orders Greg Lindberg to pay $526 million to policyholders

A North Carolina judge ordered Greg Lindberg to pay $526 million to long-suffering policyholders. The order followed a civil trial held on Friday.

Wake County Superior Court Judge Graham Shirley oversaw the trial to determine the amount of financial damages Lindberg and his companies owed to insurers they were found to have defrauded.

It was the culmination of a long-standing civil lawsuit originally filed in October 2019 by life insurers formerly owned by Lindberg: Southland National Insurance Corp., Bankers Life Insurance Co., Colorado Bankers Life Insurance Co., and Southland National Reinsurance Corp.

The majority of the $526 million award, $351 million of it, consists of punitive damages. Judge Shirley stated this was intended "to punish him and discourage others from committing similar wrongful acts."

On June 27, 2019, all four insurers were placed in rehabilitation by order of the Superior Court of Wake County. On the same date, the parties entered into a memorandum of understanding under which Lindberg agreed to place certain special-purpose insurance companies — known as special purpose captive insurers, or SACs — under a new holding company governed by an independent board tasked with protecting policyholders.

Judge: Money was 'stolen'

The plaintiffs later sued, claiming that Lindberg violated the memorandum. Plaintiffs also brought claims of fraud and negligent misrepresentation, "alleging that Defendants made misstatements in the text of the MOU that induced Defendants to enter into two other agreements: the Revolving Credit Agreement and Interim Amendment to Loan Agreement," court documents say.

WRAL covered Friday's proceedings and quoted Judge Shirley, who stated that he’s confident Lindberg has the money to pay up from funds “that he has, to put it lightly, stolen.”

This ruling is separate from other recent legal developments, such as the $122 million contempt order that Lindberg petitioned the North Carolina Supreme Court to review last week.

In November 2024, Lindberg pleaded guilty to engineering a $2 billion fraud. Lindberg was convicted for a second time in May 2024 of trying to bribe Causey.

Lindberg's sentencing is delayed while he assists a special master to unwind his business entities in order to make the victims whole. A bid by Lindberg to loosen the receivership controls over his business assets was rejected last month by the North Carolina Court of Appeals.

His guilty plea on a money laundering conspiracy charge carries a maximum 10-year sentence, the Department of Justice has said.

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.