FOR IMMEDIATE RELEASE:
December 3, 1999
Attorney General J. Joseph Curran, Jr. announced today that Frederic Jay Krieger, 58, of Valley Manor Road, Apt. 3B, Owings Mills, Maryland, has been convicted of insurance fraud and theft in connection with a scheme to fraudulently increase the policy amounts of existing client policies and pay for those increases by stealing from the clients' funds.
Krieger, who was a licensed life insurance agent for the Equitable Life Assurance Society in Baltimore City, admitted to charges that he submitted false applicatons for life insurance coverage in the names of several different clients, and that he caused the Equitable to withdraw thousands of dollars from client accounts to pay for the insurance. His guilty plea was accepted by Judge Joseph P. McCurdy, Jr. of the Circuit Court for Baltimore City. Judge McCurdy set sentencing for January 18, 2000.
In a statement of facts delivered by a representative of the office of the Attorney General, the Court learned that Krieger forged the signatures of nine (9) different clients in order to increase their death benefits. The increases ranged as high as $500,000, and required the payment of up to $6,000 in premiums. To cover these new premium obligations, Krieger forged client signatures requesting the Equitable to withdraw money from client investment accounts. In each instance, Krieger was due a commission of up to $1,800 on the sale.
All of these transactions were undertaken without the clients' knowledge or consent. Upon learning of Krieger's fraudulent activity, the Equitable reversed the transaction, restored all funds previously withdrawn from client accounts, and reported the crimes to the Maryland Insurance Administration.
"Mr. Krieger stole from both sides," said Attorney General Curran. "First, he stole from clients by withdrawing their money to pay for policies they never requested, then he stole from his employer by requesting commissions that were fraudulently earned."
The total amount of money alleged to have been stolen from clients was $38,374.02. The total in fraudulent commissions was $5,132.08.
Krieger's insurance license was revoked by the Administration in June 1998, after Krieger was found to have submitted to an insurance company documents bearing unauthorized client signatures. A criminal investigation by the Adminsitration's Insurance Fraud Division followed. The Insurance Fraud Division is staffed by employees of the Insurance Administration, the Maryland State Police, and the Office of the Attorney General.