Pennsylvania Indicts Agency Execs, Spouses in $7.5M Pyramid Scheme

August 25, 2010

Two Pennsylvania insurance agency execs and their spouses have been charged in what prosecutors say is a massive pyramid scheme that swindled local colleges, businesses and other organizations of more than $7.5 million.

The central figures in the alleged scheme are Brian James Murray, former CEO and principal of the bankrupt Murray Insurance Agency in Scranton, and Christine M. Oliver-Shean, its former president.

Both are charged with a series of crimes, including criminal conspiracy, money laundering, theft, insurance fraud, forgery, participating in a corrupt organization, tampering with evidence, obstructing law enforcement and various tax crimes.

Additionally, Corbett said that criminal charges have been filed against Murray’s wife, Diane, also of Scranton, who is accused of theft and conspiracy involving money allegedly diverted from another business to the Murray Insurance Agency, along with filing false corporate tax returns and filing false personal income tax returns.

Also charged is Christine Oliver-Shean’s husband, Timothy, of Scranton, who is accused of conspiracy, tampering with physical evidence and obstructing law enforcement regarding efforts to allegedly hide company records from investigators.

Pennsylvania Attorney General Tom Corbett said that a grand jury investigation found evidence sufficient to charge the two agency execs with the stealing the money over a decade, and using an offshore business to conceal more than $10 million in income and avoid paying state taxes.

According to authorities, the clients victimized by this wide-ranging scheme included the University of Scranton, Marywood University, Loyola College of Maryland, St. Joseph’s University and other educational institutions; Mount Airy Casino Resort; local government agencies like Phoenixville Borough; Moses-Taylor Hospital; the Lackawanna County Multi-Purpose Stadium; and other businesses and nonprofits.

The charges are related to a broader investigation that initially resulted in July arrest of Brian Murray, involving the theft of more than $1.3 million in premium payments that were collected by his company.

Corbett said the Attorney General’s Office has also filed criminal charges against three businesses linked to this alleged pyramid scheme:

The Murray Insurance Agency, The Mallow Holding Company, both based at 415 Spruce St., Scranton, and the Gaffer Insurance Co. Ltd., incorporated in Tortola, British Virgin Islands.

All three businesses have been charged with multiple felony counts, including participating in a corrupt organization, dealing in the proceeds of unlawful activity (money laundering), criminal conspiracy, aiding in the consummation of a crime, theft by deception, theft by unlawful taking, theft by failure to make required disposition of funds, insurance fraud and forgery. They are also charged with misdemeanor counts of tampering with or fabricating physical evidence, obstructing the administration of law, willfully filing false and fraudulent corporate income tax returns, willfully filing false and fraudulent Pennsylvania personal income tax returns and failure to file corporate tax returns.

Brian James Murray and Christine Oliver-Shean both face charges of participating in a corrupt organization, money laundering, criminal conspiracy — each of which are punishable by up to 20 years in prison and $25,000 fines.

Diane D. Murray is charged with one count each of theft by unlawful taking and criminal conspiracy, both third-degree felonies each punishable by up to seven years in prison and $15,000 fines.

Timothy G. Shean is charged with one count each of tampering with or fabricating physical evidence, obstructing the administration of law and criminal conspiracy, all second-degree misdemeanors which are each punishable by up to two years in prison and $5,000 fines.

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Source: Pennsylvania Attorney General’s Office

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