Asset Recovery Service Claims Insurers Owe State $524 Million (Met Life/Prudential)
Asset Recovery Service Claims Insurers Owe State $524 Million
CHICAGO (CN) - An asset recovery service claims it discovered a "massive fraud" by Metropolitan Life Insurance and Prudential Financial, which kept more than $524 million in unclaimed life insurance money that should have been turned over to Illinois.
In a qui tam complaint in Cook County Court, Total Asset Recovery Services claims that Metlife and Prudential "filed false records omitting these unclaimed funds." It says the insurers should be fined more than $1.5 billion under the Illinois False Claims Whistleblower Reward and Protection Act.
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The complaint continues: "Through its efforts, TARS has uncovered a massive fraud upon the State of Illinois ('the State') by the defendant life insurance companies named herein who have not escheated requisite funds to the state. Under Illinois law, any moneys held or owing by any life insurance corporation are deemed abandoned if they remained unclaimed and unpaid for more than five years after the moneys became due and payable as established from the records of the corporation under any life insurance policy which has matured or terminated. A life insurance policy not matured by actual proof of death of the insured is deemed to be matured and the proceeds payable if such policy was in force when the insured attained the limiting age under the mortality table on which the reserve is based, exclusive of certain narrowly tailored exceptions. Once these funds are deemed abandoned, they are subject to the custody of the State. However, through their massive fraud, the life insurance companies named herein have filed false records omitting these unclaimed funds in their reporting requirement to the State in the aim of controlling and avoiding their obligation to deliver these unclaimed funds to the State."
http://www.courthousenews.com/2012/01/25/43322.htm