The Missouri attorney general’s office has reached a deal with some former employees of US Fidelis allowing compensation for being laid off without proper warning.
US Fidelis was once a leading seller of vehicle service contracts. The Wentzville, Mo.-based company collapsed in 2009 as consumer advocates and regulators accused it of lying to consumers to sell auto protection plans that had too many exceptions and limitations.
A judge in April ruled that more than 550 former workers would share in a $1.45 million settlement of a suit alleging violation of the federal Workers Adjustment and Retraining Notification Act.
The St. Louis Post-Dispatch reports that the settlement allows the state to seek to block payouts for up to 20 key former employees.
A former co-owner of US Fidelis, Cory Atkinson of Lake St. Louis, Mo., on June 18 pleaded guilty to federal charges including conspiracy to commit mail and wire fraud and filing false tax returns. Earlier, on June 14, he pleaded guilty to state charges that included insurance fraud and stealing.
Cory Atkinson’s brother and US Fidelis co-owner, Darain Atkinson, also pleaded guilty in April to one count each of consumer fraud, insurance fraud and stealing consumer refunds.
The company filed for bankruptcy in March 2010 amid accusations it used illegal telemarketing ploys and sold worthless warranties.
The two brothers were indicted in June 2011 on charges of stealing and insurance fraud.