Judge Denies Motion to Dismiss in RICO Case

11/23/2009 - The Honorable Andrew J. Guilford of the United States District Court for the Central District of California has denied, in large part, defendants’ motions to dismiss the complaint filed by Barrack, Rodos & Bacine on behalf of plaintiffs in Reiter, et al. v. Mutual Credit Corp., et al., Case No. 8:09-cv-00811-AG-RNB.  The complaint assert claims under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), as well as various state statutory and common law causes of action, against defendants Mutual Credit Corporation, Spurling Group LLC, Spurling Group II LLC, National Wealth Advisors, Rumson Capital LP, Swope Lamberson, P.A., Michael Brown, Anthony Jacobson, Richard L. Swope, Todd Shelbaugh and David Doten. The complaint alleges that defendants exploit senior citizens using a predatory life insurance premium financing scheme which allows the defendants to fraudulently secure a life insurance policy on a senior citizen’s life and finance the initial premiums on that policy with financing terms that are designed to force the insured senior citizen to relinquish the life insurance policy to defendants. According to the complaint, once the defendants obtain ownership of a life insurance policy, they sell the policy to third-party investors in a transaction called a “life settlement.” The complaint alleges that the insured is ultimately left with next to nothing, a third party owns the life insurance policy and waits for the death of the insured, and the defendants pocket millions in connection with the sale of the policy.  If you would like to learn more about this action or if you wish to discuss the matter further, please contact BR&B attorney Samuel M. Ward by telephone at (619) 230-0800 or via email at sward@barrack.com.