Federal Grand Jury Indicts Businessman in More Than $4.6 Million Fraud Scheme
DALLAS — A federal grand jury in Dallas has indicted Wesley Michael Woodyard, believed to be most recently a resident of Dallas, on wire fraud and related charges stemming from his scheme to defraud Ace European Insurance Company (ACE) of more than $4.6 million from approximately 2002 through 2013, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, the indictment charges Woodyard with six counts of wire fraud and four counts of engaging in a monetary transaction with property derived from specified unlawful activity. The indictment was returned last week. A warrant has been issued for Woodyard’s arrest.
According to the indictment, Woodyard, 65, owned and operated Ringler Associates of North Texas, Incorporated (RANT). From approximately 1993 through 2015, RANT contracted with Ringler Insurance Agency to act as its agent to sell annuities provided by insurance underwriters whose products were offered for sale through Ringler Insurance Agency.
Ringler Associates, Incorporated (RAI) acted as a parent company for Ringler Insurance Agency and other subsidiaries conducting insurance business on behalf of RAI.
RANT settled insurance claims primarily by selling structured settlements (through annuities) offered for sale through Ringler Insurance Agency. The beneficiaries of these annuities were frequently victims of long term disability related injuries and/or death related to employment. While a policy beneficiary could choose to take a lump sum payment from the insurance company, usually the beneficiary agreed to be compensated through a structured settlement. The annuity would pay the beneficiary a set amount either monthly, quarterly or annually, for an extended period of time, often for the life of the beneficiary. Annuities usually offered the most cost-effective means for an insurance company to pay out a structured settlement. RANT sold annuities available on the open market through Ringler Insurance Agency
A large insurance company located in London, Ace European (ACE), was part of the Lloyd’s of London Insurance Syndicate (Lloyd’s). ACE used primarily two companies – Roger Rich and Company (Roger Rich) and Vanbreda International - to serve as third-party administrators to adjudicate and administer beneficiary claims against ACE; in turn, Roger Rich and Vanbreda used RANT to arrange for the purchase of several annuities on its behalf. All the beneficiaries of the ACE European insurance policies referenced in this indictment were United Nations employees who were injured or killed in connection with their employment.
Rather than follow normal procedures and instruct Roger Rich and Vanbreda to send funds directly to an insurance company (in this case, MetLife) to purchase the annuity contract for the named beneficiary, the indictment alleges that Woodyard told both Roger Rich and Vanbreda to send the funds directly to him, falsely representing to them that he would use all ACE funds to purchase the annuity policy on the open market. When Woodyard gained unlawful access and control to all ACE funds in this manner, Woodyard was also able to completely bypass the normal role of the insurance company (MetLife). When Woodyard unlawfully removed MetLife from the process, Woodyard also prevented MetLife from properly paying any commissions to the Ringler Insurance Agency. During the course of this scheme, Woodyard fraudulently retained all commissions earned by the Ringler Insurance Agency. During the course of the entire scheme, Woodyard repeatedly stole ACE funds wired from London, totaling approximately $4,674,258.00.
Woodyard, according to the indictment, continued to conceal his theft of ACE funds, by making periodic “lulling payments” to beneficiaries entitled to receive regular annuity payments. Woodyard gave beneficiaries the false impression that the source of the payments was an insurance company. From October 2004 to June 2014, Woodyard made a total of approximately $857,626 in such payments to several beneficiaries in an effort to avoid early detection of his scheme. Woodyard’s net financial gain as a result of his fraud is approximately $3,816,632.00
The indictment alleges that Woodyard used the majority of ACE funds for his own personal financial benefit, including paying for personal living expenses, gambling habits, travel expenses, and the purchase of four vehicles, including three Mercedes Benz and one Corvette, as alleged in Counts seven through ten of the indictment.
An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty. However, if convicted, the maximum statutory penalty for each count of wire fraud is 20 years in federal prison and a $250,000 fine. Each count of engaging in a monetary transaction with property derived from specified unlawful activity is 10 years in federal prison and a $250,000 fine. The indictment also includes a forfeiture allegation that would require the defendant, upon conviction, to forfeit the proceeds obtained as a result of the offense. Restitution could also be ordered.
The Federal Bureau of Investigation is in charge of the investigation. Assistant U.S. Attorney David Jarvis is in charge of the prosecution.
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