Insurance Co. Alleges Theft

Cincinnati, Ohio-based Great American Insurance Co. went to U.S. Bankruptcy Court in an attempt to rescind a crime insurance policy it had issued to the now defunct Tri-State Armored Services of Hammonton.

The insurer alleges that the owners of the armored car company, which had offices in New Jersey, Pennsylvania, Maryland and Connecticut, stole up to $50 million from some the vaults and automated teller machines it serviced for 3,000-plus East Coast ATMs for banks, credit unions and savings and loans.

According to an article from the Associated Press, Tri-State closed and declared bankruptcy last March.

Great American lawyer Stephen Dratch maintained that the insurer does not owe anything to creditors since crime insurance protects against theft by employees, not owners.

Great American maintained some of the thefts it accuses the Tri-State owners of making losses were reported to police. However, the insurer further alleges that one of the owners saw to it that none of the losses were reported to Great American so that the required policy would continue to be renewed.

It was further reported that one of the owners had been charged with bank fraud and money laundering and that another had plead guilty to helping to launder more than $1 million of bank money, for which he now faces up to 20 years in prison and a $500,000 fine. No criminal charges have been filed against a third owner.

Topics Fraud