Virginia task force targets financial fraud

It worked this way: Bromseth told potential investors that they would hand over cash to A&O, which would buy life insurance policies and pay the premiums. When the insured person died, A&O would collect the insurance settlement money and pass along a share to investors.

A&O’s sales force worked hard; Bromseth even joined his victims in prayer to persuade them to turn over their cash.

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During a four-year span that ended in 2008, Bromseth and others helped A&O collect more than $100 million from 825 people, many of them retirees, prosecutors say.

Meanwhile, A&O’s leaders in Houston didn’t invest the millions of dollars as promised. Instead, they spent it on such things as fancy trips, mansions, a Lambor ghini, a Bentley and expensive jewelry, including a 15-carat diamond ring, prosecutors say.

After the initial tip, two assistant U.S. attorneys, Michael Dry and Jessica Brumberg, began digging into the case with FBI agent Sherri Onks, Postal Inspector Marydith Newman, and John Norton, a criminal investigator with the Internal Revenue Service. The prosecutors and agents — who would form the nucleus of the task force when it was officially created in 2010 — persuaded Bromseth to spill what he knew and to make calls to other conspirators. Then they began to untangle A&O’s finances. Within months, they were confronting key players in the scheme and getting them to admit their involvement.

For nearly three years, prosecutors and agents interviewed cooperating witnesses and victims while reviewing hundreds of thousands of pages of records (they ended up collecting 1.1 million documents). “The joke here was that there were no federal holidays on the task force,” Dry said.

Guilty pleas

In all, five men pleaded guilty to various fraud-related charges and were sentenced to prison terms (Bromseth got three years). In trials this year, two principals in A&O, both of Houston, were convicted of mail and securities fraud and money laundering in a Richmond federal courtroom. Last month, U.S. District Judge Robert E. Payne sentenced Adley H. Abdulwahab, 36, to 60 years in prison, and Christian Allmendinger, 40, to 45 years.

The human toll

At the sentencings, the human toll of A&O’s scam was apparent as a handful of victims testified in gut-wrenching fashion about how the fraud had wrecked their lives and destroyed their dreams.

One spoke through tears of living frugally only to lose her savings to men who promised that “safety is the cornerstone of our philosophy.” Another said he felt “a great deal of shame for not being smarter” about investing 95 percent of his retirement with A&O. A 65-year-old retiree requested that his name not be reported because he worried that it might cause his elderly mother to have a heart attack if she learned he had lost his savings.

Through it all, prosecutors and agents watched and nodded their heads. They had heard the same stories from hundreds of A&O’s victims, and they will hear them again when they start to unravel the next big scam.