Cheshire Woman Sentenced to Prison for Fraud and Tax Offenses Stemming from Nearly $1 Million Embezzlement Scheme
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, Robert Fuller, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, and Joleen D. Simpson, Special Agent in Charge of IRS Criminal Investigation in New England, announced that JOHN HORVATH, 72, of Bristol, waived his right to be indicted and pleaded guilty today in New Haven federal court to fraud and tax offenses.
According to court documents and statements made in court, Horvath was licensed by the State of Connecticut as a resident insurance producer, which authorized him to sell various forms of insurance. In that capacity, he sold annuity contracts issued by Allianz Life Insurance Company of North America (“Allianz”) to clients. Beginning no later than July 2015 and continuing until April 2021, Horvath defrauded several clients by advising them that they could achieve better rates of return through alternative investments, rather than their existing annuity contracts, and that he could broker and manage those investments for them. Victim-investors gave Horvath investment funds with the expectation he would manage the funds for them. Instead, Horvath commingled the victim-investors’ funds with his own and used the pooled money to pay personal expenses and repay earlier victim-investors.
Through this scheme, Horvath defrauded at least eight victims out of approximately $1,189,200.
In addition, Horvath failed to pay income taxes on his substantial income from the scheme, resulting in a loss to the government of $267,739 for the 2015 through 2020 tax years.
Horvath pleaded guilty to one count of wire fraud, which carries a maximum term of imprisonment of 20 years, and one count of tax evasion, which carries a maximum term of imprisonment of five years. He is scheduled to be sentenced by U.S. District Judge Michael P. Shea in Hartford on October 18.
Horvath is released on a $50,000 bond pending sentencing.
This matter is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney Conor M. Reardon.