U.S. Attorney for the Western District of Missouri: Columbia, KC Man Pleads Guilty to $1.1M Insurance Fraud Conspiracy

JEFFERSON CITY, Missouri, June 10 -- The office of the U.S. Attorney for the Western District of Missouri issued the following news release:

A Kansas City, Mo., man who formerly lived in Columbia, Mo., has pleaded guilty in federal court to his role in a $1.1 million insurance fraud conspiracy that involved false claims of injuries suffered in car accidents, as well as to his role in a conspiracy to fraudulently obtain COVID-19 relief benefits.

Lawrence Courtney Lawhorn, 35, pleaded guilty before U.S. Magistrate Judge Willie J. Epps, Jr., on Thursday, June 8, to the charges contained in two separate federal indictments. In the first indictment, Lawhorn pleaded guilty to one count of conspiracy to commit wire fraud, one count of conspiracy to commit mail fraud, and one count of aggravated identity theft. In the second indictment, Lawhorn pleaded guilty to conspiracy to commit wire fraud.

Lawhorn is among 17 defendants who have pleaded guilty to their roles in the scheme that defrauded six insurance companies from June 2017 to July 2020. Conspirators submitted false claims that they had suffered bodily injuries and that they would be personally liable for any medical bills related to insurance claims. Conspirators, some of whom were involved in multiple incidents, received thousands of dollars, and in some cases tens of thousands of dollars, based on these false claims. However, none of the conspirators made any payments to medical providers and instead used the funds for their personal expenses.

Lawhorn was directly involved in two incidents in which he received separate payments of $1,500 and $17,350 from insurance companies. In several other incidents, Lawhorn sent emails to insurance companies, made telephone calls to insurance companies, directed others what to tell insurance companies, reviewed insurance policies prior to incidents, witnessed release agreements, and assumed the identity of parties to the incidents or people related to parties to these incidents in communication with insurance companies.

By pleading guilty today, Lawhorn admitted to his involvement in nine automobile accidents in June and December 2017, in May and August 2018, and in January, February, August, October and December 2019 as part of the insurance fraud scheme that resulted in a total loss to his victims of $1,148,198. Most of the accidents were in Columbia and Kansas City, Mo., with one accident in St. Louis, Mo.

FBI agents seized Lawhorn's iPhone and Apple Mac laptop when he was arrested in the insurance fraud case. A detective with the Boone County Cyber Crimes Task Force found evidence of additional fraud after searching those devices, which led to Lawhorn being indicted in the second case.

By pleading guilty in the second federal indictment today, Lawhorn admitted that he fraudulently obtained three $10,000 COVID-19 economic relief loans for non-existent businesses in his name and in the names of two other individuals as part of a fraud conspiracy. He also applied online for loans in the names of five more individuals, but those applications were rejected.

Under the CARES Act, the federal Economic Injury Disaster Loans (EIDL) provided loan assistance, including $10,000 in advances for small businesses. EIDL proceeds could be used to pay fixed debts, payroll, accounts payable, and other bills associated with small businesses that could have been paid had the pandemic not occurred. A business applying for EIDL relief was eligible for an advance of $1,000 per employee up to 10 employees that did not have to be repaid.

Under federal statutes, Lawhorn is subject to a sentence of up to 20 years in federal prison without parole on each of the three conspiracy charges, plus a mandatory consecutive sentence of two years for aggravated identity theft. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

These cases are being prosecuted by Assistant U.S. Attorney Aaron M. Maness. They were investigated by the FBI, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the National Insurance Crime Bureau, the Kansas City, Mo., Police Department, the Boone County, Mo., Sheriff's Department and the Missouri State Highway Patrol.

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Original text here: https://www.justice.gov/usao-wdmo/pr/columbia-kc-man-pleads-guilty-11-million-insurance-fraud-conspiracy