Miss. to Share in $72M from Convicted Former Insurance Exec Frankel

Mississippi will share in $72 million of assets seized from Martin Frankel, a former financier convicted of stealing from insurance companies, Insurance Commissioner George Dale said.

Dale said the assets were seized by the FBI and the Internal Revenue Service as a result of Frankel’s conviction for taking over and looting insurance companies in Mississippi, Arkansas, Oklahoma, Missouri and Tennessee.

Prosecutors said Frankel bought the insurance companies through a trust set up to hide his involvement since he was barred from securities trading because of a similar scheme he committed years before in Ohio.

Frankel claimed that he was investing the companies’ assets, but instead stole the $200 million to pay for a two-house compound in Greenwich, Conn., luxury cars and several girlfriends, prosecutors said.

Frankel fled the country in May 1999 shortly after a meeting with Mississippi regulators, who questioned his management of several insurance companies. He was arrested in Germany four months later and pleaded guilty to 24 counts of fraud and racketeering in 2002. He is serving a 17-year federal sentence.

Since Frankel’s arrest, Dale said the states have pursued the assets which were looted by Frankel and his coconspirators. He said a federal judge in Connecticut recently ordered that funds and assets in forfeiture accounts were the property of the receivers/liquidators of the insolvent insurance companies in the five states.

Dale said the forfeiture accounts included funds from the sale of Frankel’s two homes in Connecticut, the auction of 21 automobiles, funds seized from bank accounts in Switzerland and numerous bank accounts in the United States.

Dale said his office provided information to the FBI and the IRS that led the government to funds held in the Swiss bank account and some other U.S. and foreign accounts.

“I consider the role the Mississippi Insurance Department has played in bringing Mr. Frankel and his coconspirators to justice to be one of the finest accomplishments during my time in office.

“Since the discovery of the crime, the MID has worked tirelessly with federal authorities. It pleases me to say that all Mississippi policyholders defrauded by Mr. Frankel have been made whole,” Dale said in a statement.

Dale said several more lawsuits are pending against Frankel and others. He said so far about $126 million has been recovered from Frankel and others.