Arlington Heights Man Among 23 Arrested In Life Insurance Scheme: Feds

ARLINGTON HEIGHTS, IL — A 66-year-old Arlington Heights man is among 23 people who were charged by a federal grand jury Thursday in connection with the swindling of $26 million in life insurance benefits from at least 10 different people, prosecutors said.

Joe John was charged along with the other defendants who are from Illinois and Florida and who were arrested and charged on Thursday, according to U.S. Attorney John Lausch. The 23 people were charged with multiple counts of wire and mail fraud and are scheduled to appear in court on Friday in Florida and in Chicago, officials announced.

Prosecutors said that the 23 defendants submitted fraudulent life insurance policies in the names of various individuals and then convinced life insurance carriers to pay out the benefits, prosecutors said. They did so, Lausch said, by misrepresenting the identity of different people who had died between.

The fraud took place between 2013 and last month, according to court documents that were unsealed in court on Thursday. Prosecutors said in a news release that among the defendants are sets of spouses and, in some cases, their children, as well as an insurance agent who owned a side business that performed medical examinations on applicants for term life insurance policies, officials said.

The indictment seeks forfeiture from the defendants of at least $26 million in allegedly ill-gotten gains, as well as nine luxury automobiles, eight Rolex watches, and properties in the Chicago suburbs of Orland Park, Bridgeview, and Burbank, prosecutors said.

The Arlington Heights Police Department worked in conjunction with the FBI and federal prosecutors to investigate the alleged fraud which led to the arrest of the 23 people.

“The Arlington Heights Police Department is proud of the results achieved by detectives and agents who investigated this multistate fraud scheme involving a structured plan designed to defraud numerous insurance companies,” Arlington Heights Police Chief Nicholas Pecora said in the news release. “This investigation is a clear example of local and federal partners working in collaboration to defeat the criminal element and halt their unlawful activity.”

The charges in the indictment indicate that the defendants reportedly paid premiums on the obtained policies for two years, at which time the period for contestability expired, which made it more difficult for insurance companies to decline death benefit claims, the news release said.

Fraudulent claims for death benefits would be submitted as the defendants reportedly used records that falsely identified a different deceased person as the insured, according to the indictment. To support the fraudulent claims, the people involved obtained false death certificates in the names of the insureds and made false representations about the deceased person to law enforcement, first responders, medical personnel, funeral home staff, and cemetery employees, according to court documents.

“The fraud scheme charged in the indictment involved an elaborate deception perpetrated against multiple insurance companies for the purpose of financial gain,” Lausch said.