Financier Hit with Fines, Restitution for Insurance Violations in Indiana

March 25, 2009

A money manager accused of trying to fake his death in a plane crash took another financial hit when an Indiana judge ordered him to pay nearly $600,000 in restitution and fines.

Under the administrative law judge’s order, Marcus Schrenker must pay $304,000 in restitution to bilked investors and $280,000 in state fines for violating state insurance rules.

It comes two months after Judge Doug Webber heard testimony from investors who said they lost hundreds of thousands of dollars through annuity investments handled by Schrenker, 38. Webber had revoked Schrenker’s Indiana insurance license a day after that hearing.

Before Webber’s ruling, Schrenker already faced millions in judgments and potential penalties. Those range from an insurance company’s lawsuit in Indiana seeking $1.4 million in commissions to an Alabama judge’s order that he pay $12 million in a lawsuit over the sale of a plane.

Schrenker was arrested in a Florida campground on Jan. 13, two days after officials say he put his plane on autopilot and bailed out over Alabama to flee personal and financial problems.

The plane hit the ground about 200 miles (320 kilometers) away in Florida, where he faces federal charges in the crash near a residential area.

Nick Mann, the Indiana Department of Insurance’s chief of investigations, said in a release that he was satisfied with Webber’s order. He added that he’s “pleased that victims in this case were awarded substantial restitution.”

Schrenker can seek a hearing to challenge Webber’s order, which seeks restitution involving four investors and 28 violations of Indiana’s insurance code, with fines of $10,000 for each instance.

Investors have said Schrenker cost them hundreds of thousands of dollars in losses by forging documents, charging exorbitant fees and other fraudulent practices.

Messages left seeking comment from some of the investors weren’t immediately returned.

Schrenker recently underwent a mental evaluation to determine whether he is competent to stand trial on charges he deliberately crashed his airplane and made a false distress call. He is being held at a Tallahassee, Fla., jail.

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