Guilty pleas in $ 1 billion fraud case in Florida

MIAMI, Feb 28 (Reuters) Two people pleaded guilty to securities fraud in Florida in connection with a life insurance scheme that cost investors about 1 billion dollars, authorities said.

Carol Traina and Bari Wiggins were former managers at Mutual Benefits Corp., a Fort Lauderdale company that fraudulently promoted investment in life insurance policies held by elderly or ill people, the US Attorney's Office said in a statement yesterday.

It said US District Judge Paul Huck accepted a plea agreement and set sentencing for May 8 for Traina and Wiggins, who each face up to five years in prison.

They agreed to be jointly responsible for restitution of about 830 million dollars to investors in the company, which was shut down by federal regulators in 2004, the statement said.

Several civil and criminal cases have stemmed from Mutual Benefits.

Prosecutors have said the company directed an international network of agents who conned people into investing in viatical settlements, or high-risk agreements to buy the life insurance death benefit of a terminally ill or elderly person.

REUTERS PDM RAI1102