Corporate Crime Schemes Exposed by Diligent Processes.
In providing services for our clients, we review documents and reports filed with governmental authorities. In review of proposals, permit applications, regulatory filings and other corporate documentation, we are able to build predictive models our clients find revealing. But, it is what’s filed in litigation that is often the most revealing to the inner workings of operations and the personalities behind those operations that we find the most valuable. As it’s not unlawful to file a unsubstantiated allegation often complaints have little impact upon us until we review the exhibits filed in support of allegations and the claims associated with the documents provided. Once we evaluate the evidence file and organize the claims, a pattern typically emerges that provides an indicator of fact, which assists our firm in determining the ‘truth’ of a situation.
One such case filed against five officers and directors of companies owned by State Farm Mutual Automobile Insurance Company have not only caught our attention, it has captivated our offices globally. The complaint alleges these five defendants conspired to engage in racketeering enterprises using a conglomerate business model. On the surface, the complaint might sound outlandish. However, recently, after a year of delaying motions filed by the Defendants, the Plaintiffs filed documents before the Federal Court which included several aids to the Court that provided a visual representation of the activities of the racketeering conglomerate, its subsidiary racketeering enterprises, and the engagement of each of the five defendants. Upon review of these documents, we revisited the complaint and organized the claims to correspond with with the evidence. The Plaintiffs’ claim alleges the five individual defendants used multiple overlapping director positions to appoint each other to officer position in subsidiary companies owned by State Farm Mutual Automobile Insurance Company in order to establish, organize, and conduct racketeering activities. Upon review of exhibits, the individual defendants do in fact hold multiple director positions and do in fact hold overlapping officer positions in companies alleged within the complaint to be engaged in racketeering activities.
The most direct and obvious racketeering claim focuses on usage of illegally obtained monies through acts of frauds and the commingling of these funds. Within the exhibits, the Plaintiffs provided two checks issued from State Farm Mutual Automobile Insurance Company and State Farm Lloyds, Inc. drawn from a single JP Morgan Chase Bank, NA Account located in Columbus, Ohio. Motions filed by the Defendants for more than a year clearly argue State Farm Mutual Automobile Insurance Company and State Farm Lloyds are in fact separate companies. Evidence of two allegedly separate companies using the same bank account is concerning for any party within the business community. A fact clearly stated in the Plaintiffs’ complaint shows and supports Defendants Michael Tipsord and John Farney’s signatures on both checks while Defendant Michael Tipsord is not an officer or director of State Farm Lloyds. Clearly, two companies using the same account is an issue and the fact each check is printed in the name of a different company is cause for banking regulators to review.
Research shows Michael Tipsord is listed on State Farm Mutual Automobile Insurance Company’s corporate filings as Chairman and Chief Executive Officer of State Farm Mutual Automobile Insurance Company and State Farm Fire and Casualty Company. Mr. Tipsord’s signature on a check issued from a company that he has no corporate role in seems to support the Plaintiffs’ conspiracy argument. The fact two companies utilize the same bank account would seem to support Plaintiffs’ ‘commingling of funds’ claim. The complaint brings factual claims and the supporting evidence raises questions to the ethical and proper operation of America’s largest insurance company. Plaintiffs’ complaint claims and supports State Farm Mutual Automobile Insurance Company unlawfully profited from the conspirators’ racketeering activities gaining more than $ 200 Billion in the 10 years the racketeering enterprises have operated obscured within the companies owned by State Farm Mutual Automobile Insurance Company. Perhaps, State Farm Mutual Automobile Insurance Company should spend less time and financial resources arguing against the Plaintiff's Complaint and a renewed board of directors should entertain hiring the Plaintiffs to restore the ethical quality of America's largest insurance company.