Sec. 72. Crimes and offenses.

867 words·~4 min read·/il/chapter-215/act-159/72

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)A person acting in this State as a viatical settlement provider without having been licensed pursuant to Section 10 of this Act who willfully violates any provision of this Act or any rule adopted or order issued under this Act is guilty of a Class A misdemeanor and may be subject to a fine of not more than $3,000. When such violation results in a loss of more than $10,000, the person shall be guilty of a Class 3 felony and may be subject to a fine of not more than $10,000.

(b)A person acting in this State as a viatical settlement broker without having met the licensure and notification requirements established by Section 10 of this Act who willfully violates any provision of this Act or any rule adopted or order issued under this Act is guilty of a Class A misdemeanor and may be subject to a fine of not more than $3,000. When such violation results in a loss of more than $10,000, the person shall be guilty of a Class 3 felony and may be subject to a fine of not more than $10,000.

(c)The Director may refer such evidence as is available concerning violations of this Act or any rule adopted or order issued under this Act or of the failure of a person to comply with the licensing requirements of this Act to the Attorney General or the proper county attorney who may, with or without such reference, institute the appropriate criminal proceedings under this Act.

(d)A person commits the offense of viatical settlement fraud when:

(1)For the purpose of depriving another of property or for pecuniary gain any person

knowingly:

(A)presents, causes to be presented, or prepares with knowledge or belief that it

will be presented to or by a viatical settlement provider, viatical settlement broker, life expectancy provider, viatical settlement purchaser, financing entity, insurer, insurance producer, or any other person, false material information, or conceals material information, as part of, in support of or concerning a fact material to one or more of the following:

(i)an application for the issuance of a viatical settlement contract or

insurance policy;

(ii)the underwriting of a viatical settlement contract or insurance policy;

(iii)a claim for payment or benefit pursuant to a viatical settlement contract

or insurance policy;

(iv)premiums paid on an insurance policy;

(v)payments and changes in ownership or beneficiary made in accordance with the

terms of a viatical settlement contract or insurance policy;

(vi)the reinstatement or conversion of an insurance policy;

(vii)in the solicitation, offer, effectuation, or sale of a viatical settlement

contract or insurance policy;

(viii)the issuance of written evidence of a viatical settlement contract or

insurance; or

(ix)a financing transaction; or

(B)employs any plan, financial structure, device, scheme, or artifice to defraud

related to viaticated policies; or

(C)enters into any act, practice, or arrangement which involves stranger-originated

life insurance;

(2)In furtherance of a scheme to defraud, to further a fraud, or to prevent or hinder

the detection of a scheme to defraud any person knowingly does or permits his employees or agents to do any of the following:

(A)remove, conceal, alter, destroy, or sequester from the Director the assets or

records of a licensee or other person engaged in the business of viatical settlements;

(B)misrepresent or conceal the financial condition of a licensee, financing entity,

insurer, or other person;

(C)transact the business of viatical settlements in violation of laws requiring a

license, certificate of authority, or other legal authority for the transaction of the business of viatical settlements; or

(D)file with the Director or the equivalent chief insurance regulatory official of

another jurisdiction a document containing false information or otherwise conceals information about a material fact from the Director;

(3)Any person knowingly steals, misappropriates, or converts monies, funds, premiums,

credits, or other property of a viatical settlement provider, insurer, insured, viator, insurance policyowner, or any other person engaged in the business of viatical settlements or insurance;

(4)Any person recklessly enters into, negotiates, brokers, or otherwise deals in a

viatical settlement contract, the subject of which is a life insurance policy that was obtained by presenting false information concerning any fact material to the policy or by concealing, for the purpose of misleading another, information concerning any fact material to the policy, where the person or the persons intended to defraud the policy's issuer, the viatical settlement provider or the viator; or

(5)Any person facilitates the change of state of ownership of a policy or the state of

residency of a viator to a state or jurisdiction that does not have a law similar to this Act for the express purposes of evading or avoiding the provisions of this Act.

(e)For purposes of this Section, "person" means

(i)an individual,

(ii)a corporation,

(iii)an officer, agent, or employee of a corporation,

(iv)a member, agent, or employee of a partnership, or

(v)a member, manager, employee, officer, director, or agent of a limited liability company who, in any such capacity described by this subsection (e), commits viatical settlement fraud.