WSMV Channel 4 Judge Says CEO, Wife Ignored Spending Orders 8-18-2010

Judge Says CEO, Wife Ignored Spending Orders 8-18-2010

Reported by Jeremy Finley
NASHVILLE, Tenn.The CEO of Nashville-based company United Benefits of America and his wife were in a federal court Wednesday after the business was shut down last week by state troopers and the Federal Trade Commission. It was CEO Tim Thomas' first hearing after being sued by the state attorney general and the FTC, accused of scamming customers, many sick and uninsured.

Video: CEO Spends $16K Despite Freeze Order

A federal judge froze all the assets of Thomas and his wife, Kennan. Federal and state investigators said Thomas and his wife knew what they were selling was deceiving customers. Customers thought they were getting health insurance but instead got discount cards that barely covered their expenses.
The U.S. Attorney's Office said Wednesday that Tim Thomas and his wife blatantly ignored the judge's orders to freeze business and personal accounts by spending more than $16,000 in a matter of days on shopping, dining out, office supplies and gas for Thomas' boat and trying to remove more than $667,000 from various bank accounts. Thomas tried to withdraw $115,000 from his personal bank account, then $19,000 from another personal account, according to court records.
"Nobody's left town; everyone is here. We've accounted for all of it," said David Raybin, Thomas' attorney.
Raybin said that his client didn't know he wasn't supposed to spend his own money from his personal bank accounts; he thought only his business funds were frozen.
Attorneys for the FTC said the order clearly stated all of Thomas' assets were frozen.
FTC attorneys also said Thomas tried to transfer more than $100,000 from his personal account into a friend's account.
The next step for Thomas could be a criminal charge. The U.S. Attorney's Office will now determine if it should send this case to the grand jury to charge Thomas with criminal contempt of court.
For about two years, the Channel 4 I-Team has been investigating the company, using its undercover camera to expose supervisors training employees to lie to customers desperate for insurance.



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