Three Houston Men Accused of $103 Million Texas Securities Fraud Involving Life Insurance Scam that Victimized at Least 800 Investors
In an indictment unsealed in federal court, Adley H. Abdulwahab, Christian M. Allmendinger, and David C. White were charged with running a life insurance scam and stealing $103 million from at least 800 investors in the United States and Canada. Their Texas securities scheme allegedly involved the sale of “bonded life settlements” that guaranteed 10-20% returns. All three men are principals of A&O Resource Management Ltd., which is based in Houston.
In the US, A & O is accused of using funds from investors in 37 states to purchase the investments. A life insurance policy is bought by a third party, while the policy owner receives a cash payout. Meantime, the buyer pays the premiums and when the insured passes away, is supposed to collect on the death benefits. However, the Texas State Securities Board does not believe that the bonds purchased by A & O gave investors the returns that they were promised.
According to US Attorney Neil H. MacBride, the defendants defrauded investors for personal gain. The three men are accused of making misrepresentations regarding A & O’s previous successes, office locations, and number of employees, its investment offerings’ risks, and its use and safekeeping of investor money. Abdulwahab and his co-conspirators allegedly made up sham transactions involving A & O selling to two shell corporations once state regulators started examining investor funds.
The three defendants are charged with conspiracy, securities fraud, mail fraud, and money laundering. The Justice Department is seeking the forfeiture of about $103 million from the men.
Related Web Resources:
Three Principals of A&O Entities Arrested and Charged for Their Alleged Roles in $100 Million Fraud Scheme, FBI Richmond, September 9, 2010
3 Houston Men Charged With Stealing $103 Million in Life Insurance Fraud, Bloomberg, September 9, 2010
Life Settlements or Viaticals should be Considered “Securities,” Recommends the SEC to Congress , Stockbroker Fraud, August 5, 2010
Please contact our Houston securities fraud law firm so that we can help you explore your legal options.