Apollo Global Management Inc. Responds to Allegations of Illegal Life insurance Policies Betting on Senior Citizens
Apollo Global Management Inc. is pushing back against allegations of engaging in illegal Life insurance schemes, calling the claims “disingenuous and flat out wrong.” The fund targeted in a recent lawsuit denies participating in originating Life insurance policies, stating that it acquired pools of insurance-linked securities before being wound down in 2019.
According to a statement from Apollo, the lawsuit filed by the estate of Martha Barotz accuses the company of carrying out a fraudulent human life wagering conspiracy. The lawsuit alleges that Apollo funneled proceeds from illegal Life insurance policies through shell entities controlled by a secretive affiliate, Financial Credit Investment.
The Barotz policy reportedly paid out $5 million after her death in 2018. The policy originated in 2006 when Barotz, in her 70s, allowed an enterprise called Life Accumulation Trust III to take out the policy in exchange for a payment equaling 3% of the death benefit. The policy was later sold to FCI in 2011, according to the lawsuit.
Apollo emphasized that a previous lawsuit filed in 2020 did not find any wrongdoing on the part of the asset manager. The company stated that the judge only ruled that the original issuance of the policy in 2006 was improper.
The lawsuit also implicates affiliates of Wells Fargo Bank NA and Wilmington Savings Fund Society FSB for their administrative connections to FCI. These entities have not yet responded to requests for comment.
The Barotz estate is represented by Donald L. Gouge Jr. of Wilmington, Del., and Cozen O’Connor. Apollo, Wells Fargo, and Wilmington Savings have not appeared in court for this case.
The case, Estate of Martha Barotz v. Wilmington Savs. Fund Soc. FSB, is currently ongoing in Delaware’s Chancery Court. The lawsuit highlights the complexities and legal challenges surrounding the life settlements market and the allegations of illegal activities within the industry.