James Keating, a resident of Paoli, Pennsylvania, has been sentenced to 20 months in prison for defrauding Allied World Insurance Company. The sentence was handed down by U.S. District Judge Victor A. Bolden in New Haven and includes three years of supervised release following imprisonment.
Keating, who is 52 years old, previously worked as an Assistant Vice President and surety bond claims handler at Allied World Insurance Company. He later held a similar position at Crum and Forster subsidiary U.S. Fire Insurance Company, managing claims on Allied World surety bonds from their offices in Farmington, Connecticut.
Between 2017 and 2021, Keating engaged in fraudulent activities against his former employer through two primary methods. First, he created a shell company named American Construction & Industrial LLC to bill Allied World for unnecessary work that was never completed. Second, he solicited kickbacks from vendors of Allied World via another company he owned called Surety Risk Solutions (SRS or SR5), unbeknownst to his employer. Additionally, Keating used another entity where he had undisclosed ownership—Kodiak Asset Recovery—to conduct asset searches at inflated prices.
Through these schemes, Keating amassed nearly $1 million via American Construction & Industrial LLC, over $350,000 through kickbacks with Surety Risk Solutions, and approximately $125,000 through Kodiak Asset Recovery.
Judge Bolden ordered Keating to pay restitution amounting to $1,226,603.97. This figure accounts for the total loss suffered by Allied World ($1,446,491.95) minus the sum of $219,887.98 that Keating had already repaid under a civil judgment.
Keating pleaded guilty to wire fraud on July 30th of the previous year.
The investigation into this matter was conducted by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney David E. Novick.