Thu, Mar 6, 2014

http://www.kansascity.com/2014/03/05/4866901/lees-summit-firm-pleads-to-money.html

A Lee’s Summit company, D&D Advisors LLC, has pleaded guilty to a federal money laundering charge in connection with an life insurance investment scheme.

Federal prosecutors said the company, represented in court by its manager, David Vorbeck, pleaded guilty Tuesday to engaging in money laundering by conducting transactions with funds derived from a wire fraud scheme.

D&D Advisors, beginning in 2002, acted as the manager of several companies created by Dean McBride, prosecutors said. McBride was a financial planner and licensed insurance agent. His companies managed life settlement investments.

A life insurance settlement is created when someone sells the benefits of his life insurance policy. The buyer stands to receive the death benefits when they are paid.

A statement from the U.S. attorney in Kansas City said McBride and one of his companies, Cowboy Financial Advisors LLC, borrowed $370,000 from three investors. McBride and Cowboy secured the loans with two purchased life insurance benefits totaling $500,000.

Prosecutors said none of the three investors received any of the proceeds.

They said the wire fraud act involved another company, Philley Insurance LLC, which sold one of the insurance policies used as a guarantee to the three investors. It sold the policy to an investor called Milestone, which wired $95,000 to D&D Advisors’ bank account.

Philley falsely led Milestone to believe that the proceeds from the policy had been promised to no other investment clients, though they had been, prosecutors said.

D&D Advisors, in addition to pleading to the money laundering charge, is required to surrender its governmental licenses and pay $370,000 in restitution within seven days of its sentencing hearing. The hearing date has not been set.

The plea agreement also requires D&D Advisors to wind down its operations and close, prosecutors said.