Md. Federal Judge Sends Offshore Reinsurance Fraud Case to Mediation

BALTIMORE — A Maryland federal court has stayed a putative class action in which the plaintiffs accuse Banner Life Insurance Co. of shifting its debt to offshore reinsurers in order to hide its “questionable” solvency.

In a Nov. 5 order, the U.S. District Court for the District of Maryland granted the plaintiffs’ motion to stay pending mediation of the action.

Richard Dickman and Kent Alderson purchased Advantra Op Term 20 universal life insurance policies from Banner in 2002. The policies provided a $300,000 death benefit and no lapse guarantee in exchange for a monthly premium.

Plaintiffs allege Banner was engaged …