US Fidelis co-owner gets 40 months in prison
ST. LOUIS (AP) — One of two brothers who formerly owned the auto service contract seller US Fidelis was sentenced Tuesday to more than three years in federal prison for fraud and tax evasion.
Cory Atkinson, 42, of Lake St. Louis, Mo., pleaded guilty to the federal charges in June. He also faces sentencing Sept. 28 on state charges of insurance fraud, consumer fraud and stealing and is expected to get a four-year sentence, his attorney, William Margulis, said.
Cory Atkinson's brother, Darain Atkinson, pleaded guilty to similar state and federal charges and is awaiting sentencing.
Besides the 40-month sentence, U.S. District Judge Catherine Perry ordered Cory Atkinson to pay $4.5 million in back taxes. Assistant U.S. Attorney John Bodenhausen said Atkinson already has repaid $15 million to the U.S. Bankruptcy Court, money that will go to victims of the fraud.
Authorities say the now-defunct US Fidelis, based in Wentzville, Mo., misled consumers about what was covered by warranties, lied about affiliation with automakers and dealers and used other deceptive practices. Among other things, prosecutors have said the company fraudulently withheld substantial portions of refunds due to customers who canceled vehicle service contracts and were owed full or prorated refunds.
Perry called the fraud "extensive."
"They did it all intentionally and for no other reason that I can see other than greed," the judge said of the brothers.
She noted that friends and family wrote letters praising Cory Atkinson's morals and generosity.
"But of course that generosity came from other people's money," Perry said.