Illinois Annuity News

Former Insurance Broker Sentenced For Fraud And Money Laundering

A Hanson man was sentenced yesterday in federal court for defrauding a number of individuals who believed that they were purchasing annuity policies from Transamerica and with defrauding a client of the Catholic Order of Foresters (“COF”).

United States Attorney Michael J. Sullivan, Warren T. Bamford, Special Agent in Charge of the Federal Bureau of Investigation in New England, and Douglas A. Bricker, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Boston Field Office, announced that JOSEPH P. GARVEY, age 43, of 113 Andrew Lane, Hanson, Massachusetts, was sentenced by U.S. District Chief Judge Mark L. Wolf to 71 months in prison, to be followed by 3 years of supervised release. Restitution was also ordered in the amount of $493,748, which was less than the total amount of loss because GARVEY had returned $177,104 to some of the victims.

At an earlier plea hearing, the prosecutor told the Court that, had the case proceeded to trial, the evidence would have proven that GARVEY perpetrated two fraud schemes in which he obtained a total of approximately $670,852 from various people. In one scheme, GARVEY, a former independent producer for Transamerica and insurance agent for the Knights of Columbus (KOC), used two intermediaries to defraud several individuals into believing that they were purchasing annuity polices from Transamerica. Instead of obtaining valid annuity policies, GARVEY took checks that the individuals had made out to Transamerica and deposited them into a bank account that he controlled. GARVEY then used the victims’ monies for his and his wife’s personal benefit. In the second scheme, GARVEY pretended to be a former elderly client whom he had met through the KOC, in order to fraudulently withdraw funds from an annuity policy she had with the COF. Read more at boston.fbi.gov.

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	Did You Know?
	The NASD Reminds Members of Their Responsibilities Regarding the Sales of Variable Annuities NASD is an independent self-regulatory organization charged with regulating the securities industry, including sellers of variable annuities. The NASD recently issued a release to its members reminding them of their responsibilities to investors in selling variable annuities (NASD Notice 99-35, "The NASD Reminds Members of Their Responsibilities Regarding the Sales of Variable Annuities").