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Palmieri Sentenced

Carmen John Palmieri, who headed a licensed viatical brokerage, National Medical Funding, was sentenced to 30 years in prison by Judge Frank A. Brown of San Diego, California.

Palmieri was charged with 144 counts of insurance fraud, grand theft, and elder abuse. He sold nonexistent viatical settlement investment contracts, promising a return of 14 percent over a 12-month period. Most of the investors were retirees.

Although Palmier advertised for viators in magazines and newspapers that targeted a gay population, he didn't buy policies. Instead, he used the information he acquired about AIDS patients to create false documents. He sold 280 fraudulent investments worth $13 million.

Several victims of the scam testified. Among them: a couple who invested $100,000 in hope they would be able to use the return to pay medical bills for the husband's lung cancer battle, and a father who needed the $150,000 he lost to pay for his daughter's kidney transplant. State Insurance Commissioner John Garamendi, who attended the sentencing hearing, urged the maximum sentence of 60 years.

Dated: January 13, 2004

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