The Nebraska Attorney General’s Office said Friday that the State Department of Banking and Finance is working hard to figure out how much money is in the estate of deceased financial adviser Joe Bonnett, and to get the proceeds disbursed to victims of his fraud.
“The department is working daily to get that accomplished,” said Dave Lopez, assistant attorney general, speaking at a court hearing in Douglas County Circuit Court. “We are several weeks from getting the ball rolling.”
Bonnett, an Omaha wealth adviser, killed himself with a gun in May, after he had been charged by Douglas County prosecutors with forgery and insurance fraud. Investigators said his Ponzi scheme went back almost a decade and investor losses could reach $2 million.
Now, the beneficiaries of his life insurance – it still pays out in cases of suicide if it happens so many years after the coverage was bought – are in a tug of war with the fraud victims over the proceeds of the policy.
On the one hand, a court-appointed receiver in the case, an independent third-party attorney skilled in such matters, has asked that it be allowed to take custody of the $3.25 million in life insurance proceeds from the Ohio National Life Assurance Co. to settle victim claims.
On the other hand, the legal beneficiaries of the policy are eight people, mostly with the Bonnett surname, and the Alpha Tau Omega Fraternity at the University of Nebraska.
Friday’s court hearing didn’t advance the matter. Thomas Stalnaker, the Omaha attorney appointed receiver by the Banking Department, had asked the court last month to keep Ohio National, and another Bonnett insurer, Cincinnati Life, from turning over any proceeds to beneficiaries.
But given the possibility that Ohio National and Cincinnati Life will file their own lawsuits seeking clarification as to whom they should pay, further action on the Stalnaker restraining order was postponed on Friday for about 30 days.
If the insurance companies do receive permission to file their own lawsuits seeking clarification as to whom they should pay – something attorneys in the case view as likely – the whole issue of a restraining order will be moot.
Clarence Mock, the attorney for the Bonnett estate, said he hopes that sufficient money will be available to compensate both victims and beneficiaries.
“We want people made whole to the fullest extent possible,” Mock said.
In all, Bonnett managed 83 investment accounts totaling approximately $47.5 million in assets, according to state officials.
Contact the writer: