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Denver Church Pastor Who Defrauded AIG Life Pays $500,000 in Restitution
(BestWire Services Via Acquire Media NewsEdge) A prominent Denver-area church pastor who fraudulently obtained life insurance proceeds from AIG Life Insurance Co. has pleaded guilty to felony theft and was sentenced to serve eight years probation. He will pay $500,000 in restitution.
In return for the guilty plea by the Rev. Acen Phillips, the Colorado attorney general's office dropped 12 other counts against him, and AIG Life dropped its federal lawsuit, a spokesman with the attorney general's office said. Phillips was accused of falsifying insurance documents to funnel money to church groups he controlled.
Chris Winans, a spokesman for AIG (NYSE: AIG), the world's largest insurer, said the company is pleased and thinks the case "sends an important message to anyone who would think about committing insurance fraud."
Last summer, the Colorado attorney general's office filed felony charges against Phillips in Arapahoe County District Court. The complaint charged that Phillips, 55, forged several ?designation of beneficiary? life insurance forms that resulted in the theft or attempted theft of more than $575,000 in life insurance proceeds between July 2005 and May 2006. The forged signatures in question were those of dead people and the forms allegedly were often backdated to appear authentic (BestWire, Aug. 8, 2007).
One of the claims made against a group AIG policy was in the name of Shely Marie Lowe, who died of heart failure on May 12, 2006. Lowe was the stepmother of Aaron Thompson, a missing child. Phillips allegedly forged documents related to the life insurance claim resulting from Lowe's death. The documents named the policy's primary beneficiary as New Birth Church, with smaller percentages going to Thompson and American Church United, of which Phillips was the named chief executive officer (BestWire, Aug. 8, 2007).
In some instances, percentages or actual dollar amounts that family members thought were due to them as beneficiaries were changed to the "substantial monetary benefit" of American Church United or New Birth Church.
About five months before the attorney general's charges, AIG Life sued Phillips, American Church United and three associated Colorado church organizations: Mt. Gilead Baptist Church, Mt. Gilead Baptist Church Youth Job Mart and New Birth Temple of Praise Community Baptist Church in the Colorado federal court (BestWire, Aug. 8 2007).
"Among other things, defendants falsified paperwork and then fraudulently claimed that nonmembers had been enrolled [American Church United] members at the time of their death; altered beneficiary forms so that defendants rather than surviving family members would obtain more insurance proceeds; and used two criminally convicted and disbarred attorneys...to send a bogus letter to AIG under phony letterhead of a third attorney," AIG alleged.
The insurer sought compensatory damages against the defendants and also wanted the court to triple the amount of actual damages against them.
(By Fran Matso Lysiak, senior associate editor, BestWeek: fran.lysiak@ambest.com)
Copyright ? 2008 A.M. Best Company, Inc.
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