Causey Says Recommended Lindberg Restitution ‘Not Enough’ for Harm Caused
The more than $1 billion that a special master has recommended that imprisoned insurance mogul Greg Lindberg pay in restitution may seem like a huge amount of money. But it falls well short of covering the wreckage left behind by Lindberg’s illegal actions, North Carolina’s insurance commissioner believes.
“I am pleased to see the special master in Mr. Lindberg’s criminal case has done the work to show the scope of financial harm caused by his crimes,” Commissioner Mike Causey said in a statement to Insurance Journal.
Causey noted that in a recent court hearing, a North Carolina state judge pointed out that Lindberg’s companies owe the guaranty associations, which covered thousands of claims left by Lindberg’s less-than-solvent life insurance carriers, in excess of $1 billion. But Special Master Joseph Grier III, appointed by a judge in Lindberg’s federal criminal cases, determined that the convicted entrepreneur’s North Carolina-based insurance firms are owed about $973 million by Lindberg and his affiliated other businesses.
“So, the $973 million dollars the special master has recommended be paid in criminal restitution still won’t be enough to cover the bill,” Causey said. “At the same time, I am very disappointed to see Mr. Lindberg’s comments suggesting that he is repaying policyholders ‘in full.’ This is simply not true and he knows it.”
The $157 million paid to policyholders from the recent sale of one of Lindberg’s companies is less than 8% of the total amount that Lindberg’s policyholder victims were owed, Causey noted. The remaining 92% has been covered by the state guaranty associations.
Causey is in a position to know the details of the massive fraud, regulatory investigations, and years of litigation that resulted from Lindberg’s illicit diversion of insurance company funding to his other enterprises. Causey wore a wire in 2018 and recorded Lindberg attempting to bribe the commissioner in return for relaxed regulation on his insurance companies’ reserve funding levels.
That conversation led to Lindberg’s bribery conviction in federal court. A separate conviction on money laundering and other financial crimes prompted the federal judge to appoint the special master to determine restitution in advance of Lindberg’s upcoming sentencing. Read more here about the recent restitution recommendations.
Causey also pointed out that many policyholders were victims of Lindberg’s diversion schemes, and some of those will never be repaid.
“We also cannot forget the large number of elderly policyholder victims who will never be adequately compensated for their losses, including those who died, were unable to seek needed medical care, or were forced to keep working because their retirement funds had been placed in jeopardy,” Causey said.
U.S. District Judge Max Cogburn, in North Carolina, must now review the special master’s restitution plan and hear from parties who may disagree with it. The judge is expected hold prison-time sentencing hearings in coming months.
“I look forward to Judge Cogburn holding Mr. Lindberg responsible for the tremendous harm he has caused,” Causey added.
Lindberg, who has been held in a North Carolina county jail since late 2024, faces up to 15 years in prison under U.S. sentencing guidelines, according to news reports.
Causey’s deputy director of communications, Barry Smith, said the office does not have a tally on the amount of resources and man-hours that the Department of Insurance and other agencies have spent investigating, rehabilitating, liquidating and litigating over Lindberg’s former insurance companies.
Photo: Causey in 2019 talking about Lindberg’s schemes. (Alan Campbell/Rocky Mount Telegram via AP, File)