Near North CEO Indicted
By Mark E. Ruquet
NU Online News Service, Feb. 15, 4:02 p.m. EST?A federal grand jury in Chicago yesterday indicted Michael Segal, the former head of Near North Insurance Brokerage, Inc., on one count of insurance fraud.
In a statement, the U.S. Attorney for Northern District of Illinois said Mr. Segal was indicted for "filing a materially false statement regarding an insurance premium fund trust account that was millions of dollars in deficit."
The FBI arrested Mr. Segal Jan. 26 for allegedly embezzling $20 million from the fund over a three-year period. He was released on $750,000 bail (see National Underwriter, Feb. 11, page 9).
Because of the indictment, a preliminary hearing scheduled for today was cancelled.
The problems with the trust fund came to light after a $22 million deficit in the fund was discovered last year and reported to the Illinois Department of Insurance.
The U.S. attorney's office said the indictment charges that Mr. Segal gave false information regarding the fund to the department during a renewal application.
If convicted, Mr. Segal could face up to 10 years in prison and a maximum fine of $250,000 or a fine totaling twice the gross loss to any victim or twice the gain to the defendant, whichever is greater, plus restitution.
Mr. Segal allegedly used the funds for personal and corporate use, the FBI charged. According to press accounts, Mr. Segal issued a statement denying the charges. Harvey M. Silets, his attorney in Chicago did not respond to a request for a statement.
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