A federal grand jury in Charlotte has indicted former insurance magnate, Greg Lindberg, for masterminding a massive scheme to deceive North Carolina state regulators and defrauding thousands of insurance policyholders.
Lindberg allegedly evaded regulatory requirements meant to protect policyholders and concealed the true financial condition of his insurance companies.
The 52-year-old from Durham has been accused of using his company’s funds to finance his lavish lifestyle, including real estate, and “forgiving” more than $125 million in loans from his affiliated companies to himself.
Lindberg allegedly caused the insurance companies to engage in investments of nearly $2 billion as part of his scheme, most of which remained outstanding as of September 2022.
Since 2019, multiple insurance companies controlled by Lindberg have been placed into rehabilitation or liquidation. The scheme also caused “substantial financial hardship” for the policyholders, said the US Justice Department.
“The indictment reveals a carefully orchestrated scheme that relied on a web of complex financial investments and transactions designed to evade regulators, disguise the financial health of Lindberg’s insurance companies, and conceal the alleged purpose of the scheme – Lindberg’s personal gain,” said Dena J. King, attorney for the western district of North Carolina, in a news release.
Lindberg is charged with one count of conspiracy to commit crimes in connection with insurance business, wire fraud, and investment adviser fraud; one count of wire fraud; four counts of false insurance business statements presented to regulators; six counts of false entries about the financial condition or solvency of an insurance business; and one count of money laundering conspiracy.
If convicted, he faces a maximum penalty of 20 years in prison on each of the top counts.
In December 2022, one of Lindberg’s top executives, Christopher Herwig, pleaded guilty in a related case to conspiring with Lindberg and others to commit wire fraud, investment advisor fraud, and money laundering, as well as to the making of false statements in the business of insurance.
Lindberg remains under indictment. He is awaiting retrial in a separate case where he faces charges stemming from alleged attempts to bribe North Carolina insurance commissioner Mike Causey.
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