*PROGRAMMING ALERT* CNBC Prime’s “American Greed” to Feature Case Worked by Division of Insurance Fraud
Contact: Ashley Carr
To read CNBC Prime’s feature story about this episode, click HERE
TALLAHASSEE, Fla. – Tonight, October 23rd, at 10pm EST the television channel CNBC Prime will feature a case worked by the Division of Insurance Fraud during an episode of its hit show, American Greed. The episode follows a decade-long, multi-million dollar scam involving the buying and selling of life insurance policies to third party investors¬–a process known as a viatical settlement.
For more than a decade, Joel Steinger and his Ft. Lauderdale-based company Mutual Benefits Corporation purchased life insurance policies from people suffering with HIV/AIDS or other chronic illnesses and then sold the policies to investors. The seller was paid a cash value less than the total policy benefit and the investor was entitled to the full amount of the policy when the original owner passed away–the shorter the life expectancy, the higher the rate of return and the higher the purchase price of the policy.
Problems grew because Steinger’s company was lying about key parts of the transaction, like the life expectancies of the policyholders, which made the policies appear more valuable to investors than they were. Ultimately, Steinger became the operator of one of the largest Ponzi schemes in recent history. New investor money was used to pay premiums on existing life insurance policies rather than to purchase new policies as represented to investors. Investors rarely recovered their investments, and in total, investor losses topped $800 million.
In a case that brought together insurance auditors, state regulators and law enforcement expertise, Steinger and his cohorts landed where they belonged–behind bars. The case was later brought to the federal level and ultimately influenced public policy built to protect policyholders and investors.
Learn more about the case tonight at 10pm EST on CNBC Prime. Check your local listings.
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