Former Advisor Gets 2 Years For Embezzlement

Nov. 07--WILLIAMSPORT -- A former insurance agent from Herndon will begin a two-year prison sentence in January for embezzling more than $680,000 to allegedly pay off gambling debts.

Derl Knarr, 55, was sentenced Wednesday in U.S. Middle District Court on a charge of insurance crimes affecting interstate commerce. U.S. District Judge Matthew W. Brann made the recommendation to have Knarr serve his sentence in the federal prison in either Lewisburg, Cumberland, Md. or Charleston, W.Va.

Knarr was also ordered to pay $688,914.91 in restitution, the bulk, $664,761.24, going to Allstate Life Insurance Co. Brann ruled, though, that two victims will be paid first, one getting $20,853.67, the other $3,300.

According to U.S. Attorney Peter J. Smith, Knarr stole the funds in Snyder, Northumberland and other counties while he worked as an agent for Allstate Financial Services. The thefts occurred between 2006 and 2012.

The investigation was conducted by the FBI, State College Resident Office.

Knarr allegedly embezzled, abstracted, purloined and misappropriated money, funds, premiums, credits and other property of the insurance business totaling $630,836.72. His actions caused clients to liquidate certain Lincoln Benefit Life Co. annuities and endorse proceeds checks to him.

Knarr is accused of depositing the checks into accounts that he controlled. Knarr collected funds from clients for the purchase of annuities, which the defendant failed to purchase, instead depositing the money into his own accounts.

Knarr also allegedly used the funds stolen from his clients to pay for personal expenses, including trips to casinos in Pennsylvania and New Jersey.

Knarr will surrender himself to begin his sentence Jan. 5 at the corrections facility chosen by the Federal Bureau of Prisons.

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