Former Insurance Agent/Broker Senenced on Wire Fraud Charge
St. Louis, MO – Donald Novak, former licensed insurance agent and broker for various insurance companies, was sentenced to 29 months in prison on charges involving wire fraud. The sentence also included orders of restitution and criminal forfeiture.
According to court documents, between July 28, 2011 and July 30, 2015, Novak devised a scheme to defraud a distant relative, who suffered from certain mental limitations, of inherited assets. The fraud involved the investment, by Novak, of the victim’s funds in annuities which Novak, in turn, surrendered, misappropriated and converted for his own personal use.
"Donald Novak liquidated his client’s retirement assets only to benefit himself and not his client," said Special Agent in Charge William Woods of the FBI St. Louis Division. "This type of fiduciary abuse is on the FBI’s radar, especially going forward with new federal regulations that require financial advisors and brokers to act in the best interest of their clients."
Novak, Ellisville, Missouri, pled guilty in March 2016 to one felony count of wire fraud. He appeared today for sentencing before United States District Judge Ronnie L. White.
The case was investigated by the Postal Inspection Service and Federal Bureau of Investigation. Assistant United States Attorney Charles Birmingham handled the case for the U.S. Attorney’s Office.