Former Insurance Chief’s Sentencing Delayed; Could Face 10 Years

Former Georgia Insurance Commissioner Jim Beck will have to wait a little longer to learn his fate, after his sentencing date was postponed until Tuesday. Federal prosecutors are now asking that he serve 10 years in prison and pay fines and restitution of as much as $5 million.

Beck was convicted in July of embezzling almost $3 million from Georgia Underwriting Association, a last-resort insurer he managed that wrote policies for homeowners who had trouble finding coverage. He was elected state insurance commissioner in 2018 and was indicted just weeks after he took office in 2019.

Prosecutors said in a sentencing memorandum filed last week with the U.S. District Court for the Northern District of Georgia that about $2.5 million of Beck’s restitution payments should go to Cincinnati Insurance Co. The carrier had paid that much to the underwriting association to cover its losses from Beck’s multiyear fraud scheme, prosecutors said.

Beck should pay another $358,000 to the Internal Revenue Service for taxes he avoided in his fraud and money-laundering actions, the U.S. Attorney’s office said. To help cover the costs, Beck should now forfeit four pieces of property in the Atlanta area, along with bank accounts that hold hundreds of thousands of dollars, U.S. District Judge Mark Cohen said in a preliminary order signed Friday.

Beck’s attorney, William Thomas, of Atlanta, has argued that the amount due to Cincinnati Insurance should be reduced because Beck’s hired consultants performed some amount of legitimate work for the underwriting association, referred to as GUA. Assistant U.S. Attorneys Brent Alan Gray and Sekret Sneed agreed that Beck had arranged for a small amount of actual work product, but that other claims by Beck were purely fictitious.

“It is abundantly clear that Beck’s insistence that GUA was spending millions of dollars for legitimate services provided through Green Tech, Lucca Lu, Mitigating Solutions, and Paperless Solutions was just a ridiculous story,” the prosecutors wrote to the judge.

In fact, Beck’s sentence should be kept near the maximum allowed under sentencing guidelines, precisely because Beck lied repeatedly on the witness stand and attempted to obstruct justice, Gray and Sneed said.

Beck, a former president of the Georgia Christian Coalition, purchased the homes and other property with money he siphoned from GUA through an elaborate money-laundering operation and sham companies, the government said. Beck also was accused of using the association funds to finance his campaign for insurance commissioner.

Beck was paid a six-figure salary at the underwriting association. He then continued to receive his insurance commissioner salary even after he was removed from office. That prompted Georgia lawmakers to draft a constitutional amendment that would suspend salaries of state officials who are facing criminal charges. Voters will decide on the amendment next year.

His lawyer has said that Beck had performed a valuable service, transforming GUA from a longtime money-loser to a profitable corporation, according to news reports of the trial. The attorney has asked that the prison time be limited to about seven years. Federal guidelines allow no less than 108 months and up to 135 months, prosecutors said.

The 60-year-old Beck was allowed to remain out of prison until his sentencing date, which was initially scheduled for Friday.

Before he was named to head the underwriting association in 2012, Beck worked for a number of state agencies and was a top staffer in the Department of Insurance.

Georgia Gov. Brian Kemp suspended Beck after he was indicted and named John King, a former Atlanta police officer, to take over the insurance department.