Jailed Beverly Hills lawyer wins insurance fraud case
Saturday February 15, 2003LOS ANGELES (AP) A Beverly Hills lawyer convicted of plotting to sink his luxury yacht in order to collect $3.5 million in insurance money won a $371,000 judgment against two insurance companies that canceled his monthly disability payments because of fraud allegations.
``This is the first fair trial I've had in federal court,'' Rex K. DeGeorge said Friday after a jury returned their verdict.
The 66-year-old attorney was sentenced last year to 7 years in federal prison for trying to sink a 76-foot yacht off the Italian coast by cutting holes in the hull. The boat was only partially submerged, and DeGeorge was later rescued by the Italian Coast Guard. Prosecutors said DeGeorge, who had previously lost three other yachts at sea, used a series of phony sales transactions to drive up the boat's insurance value.
On Friday, a Los Angeles jury ruled that Equitable Life Assurance Society and the Paul Revere Life Insurance Co. must pay DeGeorge $371,000 in disability payments.
The two companies stopped paying DeGeorge his $8,200-a-month disability payment in 1999, alleging he faked his ailments and was continuing to work as a lawyer. DeGeorge filed the claims in 1990, saying he was disabled because of a heart condition and brain damage caused by an auto accident.
``We hope that this case sends a message to insurance companies that no matter who the insured is, they must pay what they agreed to pay or the jury will require it,'' DeGeorge's lawyer Peter Morris said.
The jury also found DeGeorge remains disabled, forcing Equitable to continue paying him $4,700 month for the rest of his life. Paul Revere's coverage ended when Degeorge turned 65.
Thomas B. Ackland, who represented the two insurance companies during the trial, said a decision to appeal has not yet been made.
Unless DeGeorge's conviction is overturned, he will have to forfeit Friday's judgment. As part of his sentence, DeGeorge was ordered to pay the government $2.8 million in restitution.
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