Brinson Caleb “BC” Silver, former chief marketing officer for insurtech Root, has pleaded guilty to stealing more than $10 million from his former employer and violating court orders.
According to the U.S. Attorney’s Office for the Southern District of Ohio, Silver, 43, of Culver City, California, pleaded guilty to one count each of wire fraud and contempt of court and has agreed to pay more than $10.2 million in restitution. A prison sentence of 24-51 months has been recommended.
Silver has been in jail in Butler County, Ohio since June, according to the jail’s website. A federal judge had ordered Silver detained for criminal contempt on June 20.
Columbus, Ohio-based Root Inc., parent company of Root Insurance, field a lawsuit in February in U.S. District Court for the Southern District of Ohio against Silver, accusing him of pocketing millions of dollars meant for advertising campaigns through a series of transfers from vendors to companies owned by him or his family. The U.S. Attorney’s Office said Silver spent the money on a $1.4 million yacht, a Mercedes-Benz G550 worth nearly $165,000, an amphibious airplane, expensive watches, and other items.
“Silver failed to appear in court for a hearing related to his civil suit and instead spent lavishly while traveling the globe,” said the attorney’s office.
Root last month filed an application for entry of default since Silver failed to answer or plead to an amended lawsuit. Court records show Silver has largely been uncooperative during the legal process – denying the delivery of summonses, failing to provide information to a court-appointed custodian of his property and assets, and violating a court order limiting his spending to $5,000 on day-to-day personal living expenses
The attorney’s office said Silver spent “$20,000 on plastic surgery, more than $25,000 at Indonesian businesses (including $8,000 at a luxury resort in Bali) and in withdrawals made in Indonesia, and more than $88,000 through PayPal to individuals,” said the attorney’s office. He also withheld information about a multimillion-dollar property in California and at one point “made two phone calls to an “international relocation” company and asked for citizenship within a country that would not extradite him to the United States, and a foreign bank account that the United States could not freeze.”
Silver was Root’s CMO for just one year – November 8, 2021 to November 9, 2022 – before he was let go as part of company-wide layoffs. Root said in court filings that its finance department last year had noticed some “unplanned spending from the marketing department” and started to investigate.
Root has alleged that Silver came up with a supposed advertising plan with an ad agency called Quantasy, who would then allegedly transfer a majority of the funds to companies owned by Silver called Collateral Damage and Eclipse. Quantasy and its CEO has a motion to dismiss civil claims against them awaiting a judge’s ruling.
In an email to Insurance Journal, a Quantasy spokesman said, “We can’t control Root’s frivolous claims to recover money from innocent parties that it lost due to its own inadequate internal controls and failure to monitor its own executive. We continue to strongly deny any complicity in Silver’s fraud scheme. The fact that Silver accepted responsibility for the entire fraud amount says it all.”
When contacted, Root said it could not comment due to ongoing litigation.
Was this article valuable?
Here are more articles you may enjoy.