Offshore Insurance Scam
A man was recently taken into custody in Canada by international law enforcement authorities, in what is being described as a global insurance fraud scam involving companies in St. Vincent and the Grenadines.
U.S. officials reported that both Federal and California State authorities said the international search for a fugitive wanted in connection with an alleged $20 million global insurance fraud operating via the Eastern Caribbean, ended with his arrest in Canada.
A federal complaint filed in Sacramento charges the 58-year-old man, using the alias Robert Lewis Brown, with conspiracy, mail fraud, and money laundering and making false statements.
Brown was traveling in Canada when he was apprehended by the Toronto Metropolitan Fugitive Squad on immigration charges and a U.S. arrest warrant. Most recently, however, he had been
living on his estates in Ireland and Barbados. The arrest is part of a continuing effort by the FBI, the IRS, and the California department of Insurance Investigation Division to shut down the insurance scam that operated through two companies in St. Vincent and the Grenadines.
Authorities alleged that, since January 2000, those companies, Tri-Continental Exchange Ltd. and Combined Services Ltd., collected $20 million in premiums from customers throughout the
U.S. for insurance policies they falsely claimed were backed by a collection of real insurance companies. In furtherance of the scheme, Brown and others set up a number of offshore insurance companies on the island of Nevis.
Customers were told to send payments to post office boxes in Phoenix, Arizona. The money was then forwarded first to St. Vincent and the Grenadines, then to a bank account in Blaine,
Washington, with some of the money siphoned off to foreign bank accounts.
Tri-Continental, Combined Services, and a third company, Alternative Market Exchange operated from Marcole Plaza, Halifax Street, Kingstown, and St. Vincent. Investigators from the St.
Vincent Financial Intelligence Unit, assisted by U.S. Agents and Investigators searched the Tri-Continental offices and seized numerous. insurance documents, while an Investigator from
the IRS Electronic Crimes Program also seized computer evidence. St. Vincent authorities have also frozen Brown’s local bank accounts while extradition is sought. U.S. investigators credit the close, professional co-operation they received from St. Vincent authorities with a major role in the success of this arrest effort. Prosecutors said at least eight U.S. states and Canada have ordered the companies to stop selling insurance in the last eight years, and Nationwide Mutual Insurance Co. obtained a federal preliminary injunction against the companies in 2001 for trademark infringement.
In early 2004, it is also believed that Brown and Tri-Continental started a new insurance company, American Transport Insurance Corporation, domiciled in American Samoa.
The conspiracy, mail fraud and false statements charges carry maximum five-year penalties, while money laundering has a maximum 20-year penalty.
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