SAN JOSE, CA – Gary Thornhill, 64, of Santa Clara, has confessed to a cold-blooded scheme to siphon over $1.5 million from a vulnerable widow’s insurance policy, the Department of Justice announced today. Thornhill pleaded guilty to both wire fraud and mail fraud, admitting he betrayed the trust placed in him as an insurance broker and fiduciary.
The indictment, handed down by a federal grand jury on March 24, 2016, detailed how Thornhill exploited his position at a boutique insurance brokerage. He’d initially sold a policy to a married couple in 1998, and when the husband died in 2005, the widow became the sole beneficiary. Thornhill then maneuvered himself into the role of trustee for the entity owning the policy in 2008, giving him complete control – and the opportunity to bleed the account dry.
According to court documents, Thornhill didn’t bother with consent or even notification. He simply began issuing unauthorized requests for funds, transmitting them via fax and mail. One particularly brazen act occurred on October 27, 2011, when he faxed a request for $800,000 from the policy’s cash value. The check, sent through the mail, was deposited into an account solely controlled by Thornhill, then swiftly transferred to a personal account for his own use.
The $800,000 was just the beginning. Thornhill continued the scheme for years, ultimately draining nearly $1.5 million from the widow’s account. The funds weren’t invested, weren’t held in trust – they were spent on personal expenses, a blatant display of greed at the expense of a grieving woman. He faces one count of wire fraud, in violation of 18 U.S.C. § 1343, and one count of mail fraud, in violation of 18 U.S.C. § 1341.
U.S. District Judge Lucy M. Koh accepted Thornhill’s guilty plea and has scheduled sentencing for September 14, 2017, at 10:00 a.m. Thornhill remains free on bond for now, but that won’t last. He’s looking at a maximum sentence of 20 years in federal prison, a $250,000 fine, and a hefty restitution order. The actual sentence will be determined after consideration of federal sentencing guidelines.
Assistant U.S. Attorneys Timothy J. Lucey and Laurie Worthen are prosecuting the case, the result of a thorough investigation by the Federal Bureau of Investigation. This case serves as a stark reminder that those entrusted with managing the finances of others will be held accountable for their betrayal and theft. The Grimy Times will continue to follow this case as it moves toward sentencing.
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Key Facts
- State: California
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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