A Connecticut man is headed to prison after being found guilty of defrauding insurance companies into taking on policies on the lives of elderly people for his own financial benefits.
Daniel Carpenter, of Simsbury, was sentenced in Hartford federal court to 30 months in prison, followed by three years of supervised release after he was found guilty of 57 counts of conspiracy, mail and wire fraud.
He was also found guilty of money laundering and illegal monetary transaction offenses stemming from the scheme, also known as a stranger-oriented life insurance scheme.
Carpenter, 64. controlled a series of companies based in Simsbury and Stamford that developed the Charter Oak Trust. The Trust was an employee welfare benefit plan and trust whose primary objective was to secure insurance policies on the lives of elderly individuals that could be held by Carpenter’s companies as investments, or resold on the life settlement market.
U.S. Attorney John Durham said that typically, agents promised to provide the Straw Insureds with free life insurance for two years, and, at the end of the two years, would attempt to sell the policies on the life settlement market. In most cases, the agents promised the Straw Insureds that they would receive a portion of any sale proceeds.
At trial, it was determined that Carpenter, working with insurance agents, caused several insurance providers insurance applications that contained false information and misrepresentations.
Based on the false applications that were submitted to the insurance providers, the Charter Oak Trust procured 84 insurance policies that had a total benefit of more than $459 million on the lives of 76 different people.
Additionally, another company controlled by Carpenter received more than $12 million in commissions from the insurance providers, who would not have paid the commissions had they known about the false representations on the insurance applications and the true nature of the Charter Oak Trust, Durham said.
Carpenter has a prior conviction in Massachusetts on charges of mail fraud and wire fraud offenses. He was sentenced to 36 months in prison in February 2014. Durham noted that Carpenter will also be ordered to pay an undetermined restitution at a later date.
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