| FOR IMMEDIATE RELEASE December 15, 2008 WWW.USDOJ.GOV/USAO/CAN |
SAN FRANCISCO – Mary Ann Locke was sentenced last week to 39 months in prison and ordered to pay $8,308,410.87 in restitution for embezzling funds belonging to Farmers Insurance Group, announced United States Attorney Joseph P. Russoniello.
The sentence was handed down by U.S. District Court Judge Charles R. Breyer following a guilty plea to count one (violation of 18 U.S.C. § 1033(b)(1)(B)), two (18 U.S.C. § 1033(e)(1)(A)), and eight (18 U.S.C. § 1957(a)). Judge Breyer also sentenced the defendant to a three year period of supervised release, which included the condition that Locke not engage in the business of insurance. The defendant will begin serving the sentence on December 29.
Locke, 60, of San Jose, was indicted by a federal grand jury on August 24, 2005. She was charged with embezzlement of insurance funds, participation in the insurance business following a felony conviction involving dishonesty, wire fraud and money laundering. According to the indictment, Locke began working at the Wersching Agency in 1995. In 1996 she became a 50 percent owner. In the course of working at the Agency, Locke misappropriated and embezzled more than $456,000 of premiums belonging to Farmers Insurance Group in 1997, more than $1.2 million in 1998, more than $3 million in 1999 and more than $3.4 million in 2000.
Locke pleaded guilty on January 25, 2006, to embezzlement of insurance funds, participation in the insurance business following a felony conviction involving dishonesty and money laundering.
In conjunction with this investigation, Ray Wersching pleaded guilty to a misdemeanor failure to file a corporate tax return in violation of 26 U.S.C. § 7203 and was sentenced to two years of probation with six months of home detention in CR 06-183 JL.
Christina Hua and Peter Axelrod are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Wilson Wong and Jennifer Hiwa. The prosecution is the result of an investigation by the California Department of Insurance, Investigation Division; the Federal Bureau of Investigation; and the Internal Revenue Service.
Further Information:
Case #: CR 05-542 CRB
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