Feds: Eden Prairie Man Defrauded Insurance Co.

A Minnesota man is accused of scamming an insurance company out of millions of dollars, which he used to buy an airplane and other personal items.

An Eden Prairie business owner was charged with one count of wire fraud and one count of money laundering on Wednesday, Minnesota's U.S. Attorney's office said.

Travis Scott, 34, is accused of defrauding an insurance company out of millions of dollars by submitting fraudulent claims.

Scott had an insurance policy with Zurich North America for his company, Security Management Technologies. The policy was meant to cover the business' property-including “supercomputers”-and business interruption that could result from damage to the property. Under the terms of the policy, Scott could receive the cash value of the property or replacement of the items worth up to $9.5 million, prosecutors said.

From June to December of 2008, he allegedly submitted false insurance claims and kept the proceeds for himself.

Specifically, prosecutors say that Scott told Zurich that his business had been struck by lightning, which resulted in significant damage. He told the insurance company he wanted to exercise his replacement option and began ordering replacements for his damaged computers. He then told Zurich that he received the replacement parts, and the company reimbursed him with three checks totaling about $9.5 million-which he allegedly used to buy an airplane and other personal items.

Scott also received more than $1.9 million for business interruption after he allegedly gave Zurich a falsified tax return, which was used to calculate his supposed losses.

In November, law enforcement seized three aircraft, a boat, three vehicles, and more than $5 million from bank accounts that they attribute to the fraud. Prosecutors seek forfeiture of those items, and Scott faces up to 20 years in prison for the wire fraud count, as well as 10 years for money laundering.

 

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