Jefferson City, Mo. – Attorney General Koster announced in a media that beginning this week Missouri consumers who filed claims and received restitution from his 2013 settlement with U.S. Fidelis will receive an additional $95 in restitution, totaling $45,492.17. The new settlement was reached in a separate lawsuit brought by the state of Missouri against several former high-level managers at U.S. Fidelis.
US Fidelis, a Wentzville-based auto service contract seller, sent misleading solicitations telling consumers their auto warranties had expired or would soon expire and offering to extend their service coverage. Consumers were also routinely misled into believing that the contracts they were buying covered far more repairs than they actually covered.
In March 2008, Missouri became the first state in the country to sue US Fidelis for violating consumer protection laws. Missouri’s lawsuit included allegations of deceptive mailings, misleading sales calls, illegal telemarketing, millions of illegal robo-calls, and misleading TV ads. Eleven other states filed similar suits in April 2010.
After US Fidelis filed for bankruptcy in June 2010, Koster obtained criminal indictments against the company’s owners, Darain and Cory Atkinson, for their role in the consumer fraud. They eventually pleaded guilty, with Darain receiving an eight-year prison sentence and Cory receiving a four-year sentence, both in 2012.
Missouri also negotiated with a number of former company managers to forgo their share of funds they were to receive as part of their own class-action against U.S. Fidelis alleging wrongful termination. Koster argued that some of the former high-level managers who joined the class action had knowledge of the company’s schemes and should not share in the proceeds from the suit.
Koster sued 12 of these former managers and they agreed to surrender their share of the class action payment. Recently, the Attorney General obtained additional $45,492.17 from two former managers believed to have been instrumental in the fraud. This additional restitution is being distributed to the 474 Missourians who had received restitution payments last year. Each consumer will receive $95.97 in additional restitution.
“Our goal throughout this case has been to recover every penny possible for the victims of U.S. Fidelis and to hold those who perpetrated the schemes accountable,” said Koster. “We will continue our efforts on behalf of Missouri consumers to take back every ill-gotten gain received by this company.”
While Missouri was leading a multi-state steering committee to protect consumer victims in the bankruptcy proceedings, this separate lawsuit against the highest-level managers was brought by Missouri alone. Therefore, this additional restitution payment is just for the company’s Missouri victims. In total, U.S. Fidelis, its former employees, and affiliated companies have now paid over $13 million in restitution to their victims across the country.