Parkersburg Insurance Agent Gets 6+ Years For Defrauding Clients
Carr drained clients’ retirement savings, now must pay back nearly $600,000
CHARLESTON, W. Va. – United States Attorney Booth Goodwin announced that Lloyd B. Carr, 55, an independent insurance agent from Parkersburg, was sentenced today to six years, three months in federal prison for converting client funds to his own personal use. Carr was employed as an outside agent for various life insurance companies from early 2007 until at least July 2010, including Allianz Life Financial Services, LLC (“Allianz”). Beginning sometime in 2008, Carr began taking checks provided by clients intended to purchase annuity contracts and life insurance policies from Allianz and other companies, and depositing those checks into his own accounts and spending the client funds on personal items.
On October 6, 2008, Allianz terminated its agency relationship with Mr. Carr following consumer complaints of unaccounted funds. Sometime in 2009, Carr filed a “trade name” application with the West Virginia Secretary of State’s office to operate as “Lloyd B. Carr doing business as American Life Insurance & Annuities Group” (“American Life”). American Life is not and never was an actual business entity or licensed insurance company. American Life had no employees or place of business other than sales that Carr conducted out of his home. Rather, American Life was only a “doing business as” or “dba” name that Carr used to conduct a fraudulent business.
On July 27, 2010, Mr. Carr opened a business checking account with an initial deposit of $12.50 in the name of “Lloyd B. Carr dba American Life Insurance & Annuities Group” at Huntington National Bank. Carr then began convincing existing Allianz clients to roll over legitimate retirement accounts into his bogus company. Once Carr deposited the client check, he began siphoning off those funds by making frequent ATM cash withdrawals and cashing a series of $5,000 checks.
In one instance in August 2010, Carr convinced a client, identified in the indictment by the initials “P.C.,” to cancel an Allianz policy and provide him with the settlement check. On August 2, 2010, Allianz mailed P.C. a check in the amount of $55,270.96. On August 9, 2010, P.C. endorsed the Allianz check and gave it to Carr with the understanding that the full amount would be used to pay an annuity premium with American Life, which Mr. Carr led P.C. to believe was an actual and legitimate life insurance company. Carr deposited the check into the American Life account at Huntington National Bank.
Almost immediately, Carr converted a portion of those monies for his own personal use from the American Life account either by cashing checks made payable to “cash” or withdrawing cash from ATMs located in and around Parkersburg. After several inquiries from P.C. requesting a copy of an insurance policy that Carr was supposed to provide, Carr eventually purchased P.C. a life insurance policy in January 2011 from a legitimate company known as Presidential Life Insurance Company (“Presidential Life”). However, the premium paid to Presidential Life by Carr on behalf of P.C. was only $25,000. On January 13, 2011, the Presidential Life policy was delivered to Mr. Carr by mail. Carr later delivered the policy to P.C.
Carr had illegally converted the remaining balance of $30,270.96 from the Allianz policy into cash for his own use. To appease P.C., Mr. Carr created a purported Roth IRA account issued by American Life, showing the balance of the funds the victim had provided him from Allianz was safely invested with American Life. The “American Life” “Roth IRA account” issued for P.C. was fraudulent. As Carr knew, American Life was not capitalized as an insurance or investment company, and it was not authorized to issue any type of insurance policy, security, investment, individual retirement account, or annuity contract. Carr had already converted a portion of P.C.’s funds for his own use prior to issuing the fraudulent American Life Roth IRA contract, but did so in order to convince P.C. that the balance of P.C.’s investment monies was safe and secure.
All told, Carr was convicted of fleecing twelve clients, including P.C., out of $589,000 in retirement savings.
The Court ordered Carr to serve a term of imprisonment of 75 months, noting that Carr “had brought many of his clients, who trusted him, to financial ruin.”
The investigation was conducted by the West Virginia Insurance Commission. Assistant United States Attorney Thomas Ryan handled the prosecution. United States District Judge Thomas E. Johnston is presiding over the case and imposed today’s sentence.