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Man pleads guilty in church insurance fraud case

Prosecutors say an Upstate native defrauded churches out of nearly $1 million in insurance premiums and owes more than that in unpaid claims as part of a failed plan designed to insure pastors and employees of various denominations.

William Madison Worthy, 49, who moved from Spartanburg to the Isle of Palms, pleaded guilty to federal insurance fraud in Greenville on Thursday.

Worthy was led back to jail in chains and will be sentenced at a later date.

Worthy’s bond had been revoked pending his plea deal, for violating conditions including continuing to deal in insurance business and trying to convince a mistress to fly away with him to “idyllic locations,” his attorney said in court.

The plea deal called for Worthy to agree that he diverted for his own use $400,000 to $1 million in premiums paid by church members and others who weren’t church members, who believed their insurance was provided by a reputable insurance company, according to the plea deal.

Assistant U.S. Attorney David Stephens told U.S. District Judge Henry Herlong that prosecutors believe Worthy took about $972,000.

The total in unpaid claims that Worthy will be responsible for in restitution is $1.7 million, Stephens said. In exchange for the deal, prosecutors dropped 13 counts of wire fraud, he said.

The investigation by the Department of Labor’s Employee Benefits Security Administration and the FBI determined that no employees knew of the fraud, Stephens said.

Worthy’s attorney, Michael MacKinnon, asked Herlong to allow Worthy to be free on bond while he awaits sentencing, a request Herlong deferred for a federal magistrate who had revoked Worthy’s bond two weeks ago.

MacKinnon told the judge that Worthy had no passport and couldn’t follow through on his talk of flying to the Caribbean or Costa Rica with his mistress. Herlong disputed that, saying that plenty of people enter the country illegally every day.

MacKinnon asked that Worthy be allowed to stay in a halfway house in Charleston so he could get his business in order and begin to reconcile with his wife.

Greenville Online

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Written by lordsinsurancelog

October 24, 2011 at 6:53 pm

Posted in Insurance News