Georgia Insurance Commissioner indicted in fraud case

Pressure mounts on Georgia insurance commissioner to resign

Georgia Insurance Commissioner Jim Beck shuffled into a federal courtroom Wednesday, shackled at the wrists and ankles. He left with restraints on his power and a call from Gov. Brian Kemp to resign.

Beck, 57, is accused of using an elaborate scheme to steal $2 million from his former employer before winning the November election for his current job. The Republican, who surrendered to the FBI on Wednesday morning, pleaded not guilty to fraud and money laundering in the court hearing. In a letter sent to Beck afterward, Kemp said the 38-count indictment “severely undermines your ability to fulfill your official obligations.”

Judge Russell Vineyard imposed restrictions on Beck, an ex-insurance lobbyist and former leader of the Georgia Christian Coalition, while granting him a $25,000 cash bond. The judge said the commissioner can’t travel out of state without permission and must recuse himself from any dealings with former employer the Georgia Underwriters Association. As insurance commissioner, Beck has regulatory authority over the association, a fact that troubled Kemp.

“In light of this connection and the possibility of new revelations, it would be highly inappropriate for you to continue to hold public office,” wrote the governor. “I ask that you do what is right for our state and step down immediately.”

Through attorneys, Beck has denied all allegations and said he intends to keep his job. Kemp can’t remove Beck from office, but state law says the governor has two weeks to appoint a panel to consider whether he should be suspended.

U.S. Attorney Byung J. “BJay” Pak said Beck used the stolen cash to pay personal credit card bills and taxes, as well as pump money into his 2018 campaign.

The evidence shows Beck lied to close friends he has known for 25 years and a family member to get them to create companies to send invoices to the Georgia Underwriters Association, Pak said. The invoices were often for work that wasn’t actually done, and Beck funneled the money back to himself, according to the indictment.

Because of the alleged lies and the fact that Beck could face 10 years in prison, Pak said Beck should put up cash for bond, rather than just promise to come back to court, as many indicted officials would be allowed to do.

“His word really doesn’t mean much,” the U.S. Attorney told the judge.

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Pak also said Beck should have nothing to do with the Georgia Underwriters Association. The association is a state-created marketplace that provides high-risk property insurance to Georgia homeowners having trouble getting coverage. The insurance commissioner has the power to appoint four members of its eight-member board and has a say in who runs for the other four seats.

Defense attorney William “Bill” Thomas told the judge Beck was willing to recuse himself from anything involving the association.

Pressure to go further and resign grew by the hour Wednesday.

Top Democrats, including the head of the state party and the minority leader in the state House, called for Beck to step aside. They were joined by at least two prominent Republicans.

Scott Johnson, who is running for state GOP chair, said he read the indictment and thinks Beck should resign. Buzz Brockway, a former GOP state legislator and candidate for secretary of state in last year’s election, said Beck should resign or at least step aside until the case is resolved.

Lt. Gov. Geoff Duncan said he was stunned at the “level of sophistication” of the alleged scheme, but he would not say whether he wanted Beck to resign. He said he wanted the governor to take the lead on the issue. Duncan was speaking on Georgia Public Broadcasting’s “Political Rewind” — a few hours before Kemp urged Beck to resign.

The governor’s letter is expected to lead to even more pressure on Beck as the state GOP heads to its convention Friday in Savannah.

If Beck resigns or is suspended by a governor-appointed panel, Kemp would appoint a successor. Beck could also recuse himself from all his duties in the job, where state records show he earns just over $120,000 a year. If that happens, the role would presumably be filled by deputy commissioner Drew Lane, a former prosecutor who recently served as the Georgia Underwriting Association’s chief counsel.

Beck’s attorney suggested the commissioner's deputy could handle any dealings with the Georgia Underwriting Association. The judge approved that, but no one mentioned that Lane also had history with the association.

Georgia Insurance Commissioner indicted in fraud case

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