Even Fraud Are Bigger in Texas-Insurance Broker Sentenced in Annuities Scam

by Wall Street Fraud on November 10, 2011

Stock broker fraud attorneyAn Amarillo, TX man has been sentenced to more than seven years in prison after he pleaded guilty in July to one count of money laundering in connection with a two-year annuity scam to drain elderly clients’ annuities that totaled more than $600,000, court records show. Timothy Fry, 33, was also ordered to pay more than $582,000 in restitution.

According to federal prosecutors, Fry and his mother, Janice Demmitt, 60, sold annuities from 2007 to 2009 as registered agents of Allianz Life Insurance Company of North America, based in Minneapolis. They convinced investors, many of whom were elderly, to cash in or borrow against their accounts with Allianz based on false promises that they would reinvest those funds and match the investment up to $100,000.

On behalf of the investors, Fry and Demmitt sent requests to Allianz to liquidate their clients’ investment annuities, which Fry and Demmitt deposited in their personal accounts, the indictment said. Fry and Demmitt bilked investors out of more than $600,000, according to court records.

Jeff Faust, an Allianz spokesman, said in July the company terminated Fry’s contract to sell Allianz products in May 2008, and Demmitt’s contract was severed in January 2009. The company reported the matter to authorities and assisted in the investigation, Faust said. Allianz Life also fully reimbursed the investors involved in the scam, Faust said.

The Message for Investors

As evidenced by this recent scheme, fraudsters continue to target the annuities of older investors. In many cases such as this, unscrupulous investment professionals will often persuade retirees to cash out their annuity and use the funds for another type of investment without explaining the risks. Therefore, investors should thoroughly research the investment and the person recommending it before making any major decisions regarding an annuity.

If you have been the victim of annuities fraud, we may be able to help you recover your losses. Contact us today at 215-839-3953 for a free consultation.

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At Wall Street Fraud, we are dedicated to offering assistance to those who have been hurt by improper corporate or investment practices.

If you have been the victim of stock brokerage fraud, securities fraud, mutual fund fraud, stockbroker fraud, annuities fraud, or any other type of investment fraud, please contact us today for a free case evaluation. Our talented and aggressive legal and professional staff is eager to help you recover your losses.

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