(Updates with description of scheme in third paragraph.)
June 10 (Bloomberg) -- Adley H. Abdulwahad, one of three principals at Houston-based A&O Resource Management Ltd. charged with stealing $103 million in a death benefits scheme, was found guilty by a federal court jury in Virginia of conspiracy, securities fraud and money laundering, prosecutors said.
Abdulwahad, 35, and his colleagues stole money from 800 people across the U.S. and Canada, including elderly retirees who lost their life savings, in a scheme to sell “life settlements,” U.S. Attorney Neil MacBride in the eastern district of Virginia said today in an e-mailed statement.
The investments involved life insurance policies that were sold to a third party, with the policy owner getting a cash payout while the buyer of the settlement investment paid the premiums to maintain the policy and collect the benefit upon the death of the insured person, prosecutors said in September when Abdulwahad was charged.
The underlying life insurance policies never existed in any number that they could possibly pay off their investors, prosecutors said. Evidence at trial showed that Abdulwahad routinely used investor funds for personal use, including a lavish home, a Ferrari and a BMW, according to the statement. Abdulwahad faces as long as 20 years in prison. A co-defendant was convicted in March.
Murray Janus, Abdulwahad’s attorney, didn’t return a voice- mail message seeking comment after regular business hours today.
The case is U.S. v. Allmendinger, 3:10-cr-00248, U.S. District Court, Eastern District of Virginia (Richmond).
--Editors: Michael Hytha, Peter Blumberg
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