U.S. Attorney for the Western District of Missouri: KC Man Sentenced in $1.1M Insurance Fraud Conspiracy

JEFFERSON CITY, Missouri, June 13 -- The office of the U.S. Attorney for the Western District of Missouri issued the following news release on June 12, 2023:

A Kansas City, Mo., man was sentenced in federal court today for his role in a $1.1 million insurance fraud scheme that involved false claims of injuries suffered in car accidents.

Michael Stuart Smith, also known as "Black Mike," 36, was sentenced by U.S. District Judge Roseann Ketchmark to four years in federal prison without parole. The court also ordered Smith to pay $40,836 in restitution to his victims.

On April 26, 2022, Smith pleaded guilty to participating in a conspiracy to commit wire fraud and to participating in a conspiracy to commit mail fraud.

This case stems from a long investigation by the FBI into co-defendant Lawrence Courtney Lawhorn, 35, of Kansas City, Mo. (formerly of Columbia, Mo.), for a series of automobile accidents throughout Missouri. All but one of those accidents were staged.

Lawhorn recruited friends, acquittances, family, and friends of friends to participate in the staged accidents. Conspirators went to various medical providers, claiming injuries from the staged accidents and requesting various testing, such a MRIs, CT scans, and/or X-rays. Conspirators then submitted false claims to insurance companies 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.

Smith admitted that he participated in two of the staged automobile accidents on May 12, 2018, and Feb. 27, 2019.

Lawhorn pleaded guilty on Thursday, June 8, to one count of conspiracy to commit wire fraud, one count of conspiracy to commit mail fraud, and one count of aggravated identity theft. Lawhorn also pleaded guilty in a separate and unrelated case to commit wire fraud. His sentencing date has not yet been scheduled.

This case is being prosecuted by Assistant U.S. Attorney Aaron M. Maness. It was investigated by the FBI and the Bureau of Alcohol, Tobacco, Firearms and Explosives.

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