ATTORNEY NEWSLETTER
Apollo Global Management spent millions of dollars to invest in Caesar’s and Harrah’s casinos in 2013 to keep the company afloat, getting the cash from its life insurance division, Athene Life Insurance and Annuity Company.
Indirectly, it became Athene Life Insurance and Annuity Company’s investment in the casino company, in exchange for a promissory note and some nonvoting stock. Although state insurance commissioners are supposed to watch to make sure the money is invested safely so that policies can be paid out when the holders die, the transfer was approved. This past January, the casino company went bankrupt.
Aviva USA, a division of large British insurance company Aviva that came to the United States in 2006, was sold to Apollo for $1.5 billion in 2012. Apollo actually paid $2.2 billion to Aviva, leaving less money available to back up policies. Representatives of Athene Life Insurance and Annuity Company assured that there was still enough money available to back up its annuity and insurance policies, but that was because of a risky maneuver known as captive reinsurance.
In a series of complicated moves, Apollo had purchased Aviva USA for the purpose of obtaining their annuities business and reinsuring it through a Bermuda affiliate, with Athene Life Insurance and Annuity Company providing $2 billion. Apollo then sold the life insurance division to Accordia Life and Annuity. Although Accordia Life and Annuity should have had $7 billion available to secure the obligations, it instead set up six subsidiaries to insure the business for less. Some of the subsidiaries were essentially “hollow assets,” with no actual business operations or ability to pay, utilizing IOUs to prop up the balance sheets.
Accordia Life and Annuity and Athene Life Insurance and Annuity Company are far from the only companies doing this, and captive reinsurance has led to billions of dollars in unpaid taxes.
Evans Law Firm, Inc. handles all types of annuities fraud and insurance fraud cases. If you have purchased an annuity or life insurance policy through Accordia Life and Annuity and Athene Life Insurance and Annuity, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at info@evanslaw.com to determine if this was a suitable investment for you.
