Former Chattanooga-Area Public Claims Adjuster Sentenced For Mail Fraud
CHATTANOOGA, Tenn. – On August 4, 2021, Benjamin Reichel, 55, was sentenced to serve 54 months in prison, followed by three years’ supervised release, by the Honorable Curtis L. Collier, in the United States District Court for the Eastern District of Tennessee at Chattanooga.
In November 2020, as part of a negotiated plea agreement, Reichel pleaded guilty to felony mail fraud charges. According to court records, Reichel operated a Chattanooga-area business known as Loss Recovery Specialists (“LRS”). LRS held itself out to be a public claims adjuster licensed by the State of Tennessee to negotiate with insurance companies on behalf of homeowners and others who had suffered property damage.
When homeowners reached out to Reichel for help, Reichel fraudulently diverted his clients’ funds for his own personal gain. The United States argued at sentencing that, under Reichel’s scheme, rather than using the funds to repair his clients’ homes, he used the money to pay for, among other things, a babysitter, massages, the lease on an Audi, personal vacations, and a swimming pool, impacting a number of innocent victims.
Reichel will be required to make restitution of over $850,000 to his victims.
The charges resulted from an investigation conducted by the Federal Bureau of Investigation, the United States Postal Inspection Service, the Cleveland Police Department, and other local law enforcement agencies.
Assistant U.S. Attorney Kyle J. Wilson represented the United States.