Judge sends Greg Lindberg back to federal prison for fraud, bribery

Federal District Court Judge Max O. Cogburn sentenced disgraced financier and insurance company magnate Greg Lindberg to more than 12 years in federal prison on Tuesday.

Lindberg, 56, had appealed to the court for a sentence essentially amounting to time served. In a recent sentencing memorandum, Lindberg’s attorneys requested concurrent 48-month prison sentences in both his bribery conviction and a separate $2 billion fraud case.

The filing sought additional reductions that would effectively credit Lindberg for nearly all of his time already served in custody.

As of this week, Lindberg has served 561 days at the Gaston County Jail. He previously spent 633 days in federal prison after his initial conviction in a bribery case tied to campaign contributions. That conviction was overturned by the U.S. Court of Appeals for the Fourth Circuit in 2022.

Prosecutors retried the case, and Lindberg was convicted again in May 2024. Separately, he pleaded guilty in November 2024 in a financial crimes case involving what prosecutors previously described as a $2 billion fraud scheme.

Massive fraud uncovered

According to court documents and evidence presented in court, from at least 2016 through at least 2019, Lindberg conspired with others to defraud various insurance companies, other third parties and hundreds of thousands of insurance policyholders, the U.S. Attorney said in a news release.

Lindberg and others conspired to deceive the North Carolina Department of Insurance and other regulators, evaded regulatory requirements meant to protect policyholders, concealed the true financial condition of his companies and improperly used insurance company funds for his personal benefit, the release said.

Lindberg and his co-conspirators caused companies he controlled in North Carolina, Bermuda, Malta, and elsewhere to invest more than $2 billion in loans and other securities with his own affiliated companies and laundered the proceeds of the scheme.

Lindberg directed the scheme and personally benefitted from the fraud in part by “forgiving” more than $125 million in loans to himself from the insurance companies that he controlled. Lindberg used his ill-gotten gains to fund a lavish lifestyle, buying private jets, mansions and a 200-foot luxury yacht, the release said.

To carry out these conspiracies, Lindberg and others engaged in circular transactions among Lindberg’s web of entities using insurance company funds and misled or omitted material information from regulators, various ratings agencies, insurance companies and ultimately policyholders, regarding these transactions.

As Lindberg’s fraud and money laundering conspiracies were beginning to unravel, from April 2017 to August 2018, Lindberg and others attempted to bribe the North Carolina insurance commissioner, giving millions of dollars in campaign contributions in exchange for favorable regulatory outcomes.

Policyholders still owed

As a result of Lindberg’s conduct, his insurance companies, third-party entities and policyholders suffered substantial financial hardship, and multiple of his insurance companies have been placed in rehabilitation and liquidation. To date, thousands of individual policyholders and other victims are collectively still owed more than $1 billion, the release said.

A special master was appointed by the court in the fraud case to assist with the restitution process and distribution of funds to victims. A separate restitution hearing will be set at a later date.

Defense attorneys argued the federal sentencing guidelines “substantially overstate” the losses tied to the cases and said Lindberg has made “unprecedented restitution efforts” since his earlier sentencing. The filing also cited his cooperation with a special master overseeing restitution matters.

Lindberg's legal troubles might not be over. Wiley Nickel, all but certain to be elected as the next district attorney for Wake County, N.C., took to social media to announce that he will seek state criminal charges against Lindberg:

That could be significant as Lindberg continues an aggressive campaign for a presidential pardon. North Carolina Insurance Commissioner Mike Causey and U.S. Senators Thom Tillis and Ted Budd have publicly urged the president to deny this request.

'Countless hours' helping inmates

Last week, Lindberg provided several letters from supporters urging the court to go light on his sentence.

“While incarcerated, Greg spent countless hours helping other inmates improve themselves,” wrote Richard McDonald, who was in prison with Lindberg. “He taught entrepreneurship classes, financial literacy, employment preparation, and business fundamentals. But more importantly, he gave people hope. He treated incarcerated men like human beings capable of rebuilding their lives.”

In January, a judge ordered Lindberg to pay $526 million to policyholders in a civil lawsuit originally filed in October 2019 by life insurers he formerly owned: Southland National Insurance Corp., Bankers Life Insurance Co., Colorado Bankers Life Insurance Co. and Southland National Reinsurance Corp.

On April 3, special master Joseph Grier recommended that Lindberg pay $1.625 billion in restitution to eight insurance companies he was convicted of defrauding. The largest share, $821 million, is owed to Colorado Bankers Life.

Correction: Initial versions of this story incorrectly reported the length of Lindberg's sentence.

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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.