A former co-owner of auto service contract seller US Fidelis has been sentenced to more than three years in federal prison.
Cory Atkinson of Lake St. Louis, Mo., was sentenced Sept. 18 in St. Louis. He pleaded guilty in June to federal fraud and tax evasion charges. He also faces sentencing Sept. 28 on state charges of insurance fraud, consumer fraud and stealing.
In addition to the 40-month sentence, U.S. District Judge Catherine Perry ordered Atkinson to pay $4.5 million in back taxes.
His brother, Darain Atkinson pleaded guilty to similar charges. He faces federal sentencing on Sept. 25 and state sentencing on Oct. 1.
The brothers were indicted in June 2011 on charges that include stealing and insurance fraud.
Authorities say the now-defunct US Fidelis misled consumers about what was covered by warranties, lied about affiliation with automakers and dealers, and used other deceptive practices.
A petition filed in St. Charles County Circuit Court by the Missouri Department of Insurance in September 2010 alleged 14 different state laws were violated by US Fidelis and its owners Darain Atkinson and Cory Atkinson. The DOI petition alleged that US Fidelis’ additive product contracts were actually illegal insurance contracts, sold without the insurance director’s authorization and without an insurance license.