An insurance mogul has pleaded guilty to conspiracy to commit offenses against the U.S. and conspiracy to commit money laundering in connection with a scheme to defraud insurance regulators and policyholders through a web of companies based in North Carolina, Bermuda, Malta, and elsewhere.
According to court documents, from no later than 2016 through at least 2019, Greg Lindberg, 54, of Tampa, conspired with others to defraud various insurance companies, other third parties, and ultimately thousands of insurance policyholders.
Lindberg and others conspired to deceive the North Carolina Department of Insurance and other regulators, evaded regulatory requirements meant to protect policyholders, concealed the true financial condition of his companies, and improperly used insurance company funds for his personal benefit.
Lindberg and his co-conspirators caused companies he controlled to invest more than $2 billion in loans and other securities with his own affiliated companies and laundered the proceeds of the scheme.
As set forth in the indictment, Lindberg directed the scheme and personally benefitted from the fraud in part by “forgiving” more than $125 million in loans to himself from the insurance companies that he controlled.
To carry out the conspiracies, Lindberg and others engaged in circular transactions among Lindberg’s web of entities using insurance company funds and made and caused to be made various materially false and misleading statements and representations to and omitted material information from regulators, various ratings agencies, insurance companies, insurance policyholders, and others regarding these transactions.
As a result of Lindberg’s conduct, his insurance companies, third-party entities, and policyholders suffered substantial financial hardship, and some of his insurance companies have been placed in rehabilitation and liquidation.
“Greg Lindberg and his co-conspirators misused $2 billion of company funds in their international scheme to defraud corporate victims, regulators, and policyholders,” said Principal Deputy Assistant Attorney General Nicole Argentieri, head of the Justice Department’s Criminal Division.
Lindberg created a complex web of insurance companies, investment businesses, and other business entities and exploited them to engage in millions of dollars of circular transactions, said U.S. Attorney Dena J. King for the Western District of North Carolina.
King added that Lindberg’s actions harmed thousands of policyholders, deceived regulators, and caused tremendous risk for the insurance industry.
“Lindberg’s elaborate network of investments, insurance companies, and financial deals was designed to exploit the insurance system and drain millions from policyholders to enrich himself at the public’s expense,” said Special Agent in Charge Robert M. DeWitt of the FBI Charlotte Field Office.
Lindberg pleaded guilty to one count of conspiracy to commit offenses against the United States, including wire fraud, investment adviser fraud, and crimes in connection with insurance business, and one count of money laundering conspiracy.
He faces a maximum penalty of five years in prison on the conspiracy to commit offenses against the United States count and 10 years in prison on the money laundering conspiracy count.
In addition to pleading guilty to these charges, on May 15, following a retrial, Lindberg was convicted by a federal jury in Charlotte of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions, aimed at bribing the elected North Carolina Commissioner of Insurance to influence the regulation of Lindberg’s insurance companies.
A sentencing date has not yet been set. A federal district court judge will determine Lindberg’s sentence in both cases. Lindberg was remanded into the custody of the U.S. Marshals.
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 offenses against the United States, including wire fraud, investment advisor fraud, and money laundering, as well as to the making of false statements in the business of insurance. Herwig is also awaiting sentencing.
