Georgia’s insurance commissioner surrendered to federal authorities Wednesday morning to face charges of fraud, money laundering and embezzlement.
Jim Beck, 57, is expected to be arraigned at 2:30 p.m.
Bill Thomas, a lawyer for Beck, said in an emailed statement to the Associated Press that Beck "strongly denies" the allegations.
"He acted legally and in good faith," Thomas wrote, adding that Beck "looks forward to clearing his good name."
Thomas also noted that the allegations do not relate to Beck's work as insurance commissioner and that he looks forward to continuing that work.
Whether Beck gets to stay in office depends on whether the charges against Beck relate directly to his duties as insurance commissioner. Gov. Brian Kemp, if he believes Beck should be removed from office, will appoint a review committee.
The 38-count indictment handed down Tuesday accuses Beck, 57, of devising an elaborate fraudulent invoicing scheme to defraud his employer out of more than $2 million over a five-year period just prior to his election in November.
“The FBI investigation found that Beck abused the trust of friends and his employer, in an elaborate scheme to enrich himself at GUA’s expense,” Chris Hacker, special agent in charge of FBI Atlanta, said. “The indictment is a testament to the fact that the FBI will expend all resources necessary to hold those who seek to enrich themselves through fraud and deceit, accountable for their actions.”
The Georgia Underwriting Association is an insurance association created as part of the Georgia Fair Access to Insurance Requirements law to provide high-risk property insurance to homeowners located throughout Georgia. In addition to premiums collected from its customers, GUA is also funded by issuing assessments to the association members, which include every insurer authorized to write any form of property insurance in the state, according to a news release from the U.S. Attorney’s office
The indictment alleges Beck embezzled in excess of $2 million between 2013 and 2018. It said Beck used some of the proceeds from the schemes for his campaign for insurance commissioner last year, as well as spending thousands on personal expenses and investments. Some of the money was also used to pay his state and federal income taxes to make improvements on rental property he owned.
According to the indictment, Beck defrauded the association by helping set up fake companies which then produced fraudulent invoices. Beck is also accused of involving the Georgia Christian Coalition, which he once represented, in the fraud scheme.
The investigation is continuing and officials wouldn't comment on whether additional indictments would follow. At least two of the companies provided no services for the money that they invoiced, and while the other two provided some services they also acted as a pass-through for billing for one of the other companies.
Hacker said the investigation began about 10 months ago, before Beck's election as insurance commissioner, and was based on a referral from the Georgia inspector general.
"Evidence established the fact that Beck abused the trust of friends and his employer, GUA, in an elaborate scheme to enrich himself at GUA's expense," Hacker said.
According to the Georgia Constitution, whether Beck is suspended from office while under indictment depends on whether the charges are determined to relate "to the performance or activities" of that office.
Once the governor receives the indictment, he must wait 14 days and then, if he believes the charges relate to Beck's performance of his responsibilities as commissioner, appoint a review commission made up of the attorney general and two other public officials.
The commission would have 14 days to hold a hearing and make a determination. If the commission decided that "the indictment relates to and adversely affects the administration of the office of the indicted public official and that the rights and interests of the public are adversely affected" by that, the governor would suspend him immediately pending the outcome of the case or the expiration of his term, whichever comes first.
http://accesswdun.com/article/2019/5/795003/insurance-commissioner-surrenders-to-federal-authorities