PHILADELPHIA – U.S. Attorney William M. McSwain announced that Gary Frank, 48, of Philadelphia and Bala Cynwyd, PA, was sentenced to 210 months’ imprisonment, five years supervised release and ordered to pay $33,702,900 in restitution by United States District Judge Gerald Pappert for executing a massive fraudulent loan scheme, for which he was indicted in March 2018 on charges of wire fraud, bankruptcy fraud, and money laundering, and to which he subsequently pleaded guilty in April 2019. Immediately following the sentencing hearing, the defendant was taken into custody to begin serving his jail sentence.

For over a decade, the defendant executed a complex and sophisticated scheme to defraud numerous victims. Frank owned and operated a Bala Cynwyd business named the Legal Coverage Group, Ltd., which contracted with employers desiring to offer a legal plan to their employees as part of their benefits plans. Frank tricked his victims into believing that the Legal Coverage Group was a rapidly growing leader in the legal services industry, generating hundreds of millions of dollars of annual revenue and employing hundreds of individuals. In reality, Frank’s business experienced virtually no growth from approximately 2006 through 2017, and generated only several thousand dollars of annual revenue.

Through this fraud, the defendant obtained over $30 million in loans, which he used to live an extravagant lifestyle, including finagling his way into the cultural scene in Philadelphia with positions on the boards of the Philadelphia Orchestra and the Philly Pops. The defendant’s largest victims were banks and financial institutions, which loaned the Legal Coverage Group millions of dollars based upon the defendant’s lies. The defendant also allegedly deceived many individuals and other entities, including several of his close friends, his company’s staff members, its advisors, customers, vendors, and local charities.

“Gary Frank is nothing but a con man and now he’s where he belongs – in a prison cell. And he will be there for a very long time,” said U.S. Attorney McSwain. “His greed and his lies were bound to catch up with him, and they did. My Office will continue to work aggressively with our law enforcement partners to protect innocent individuals and businesses from being victimized by financial fraud.”

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Patrick J. Murray.

PHILADELPHIA – United States Attorney William M. McSwain announced that Gary Frank, age 48, of Philadelphia and Bala Cynwyd, Pennsylvania, was charged today by indictment with wire fraud, bankruptcy fraud, and money laundering, stemming from a massive fraudulent loan scheme.

According to the indictment, for over a decade, the defendant executed a complex and sophisticated scheme to defraud numerous victims. The defendant owned and operated a Bala Cynwyd business named the Legal Coverage Group, Ltd., which contracted with employers desiring to offer a legal plan to their employees as part of their employee benefits plans. It is alleged that the defendant tricked his victims into believing that the Legal Coverage Group was a rapidly growing leader in the legal plan industry, generating hundreds of millions of dollars of annual revenue and employing hundreds of individuals. In reality, however, the Legal Coverage Group experienced virtually no growth from approximately 2006 through 2017, generating only several thousand dollars of annual revenue. Through this fraud, the defendant allegedly obtained over $30 million in loans, which he used to live an extravagant lifestyle.

According to the indictment, the defendant’s largest victims were banks and financial institutions, which loaned the Legal Coverage Group millions of dollars based upon the defendant’s fraudulent misrepresentations and false documents that he created.  The defendant also allegedly deceived many individuals and other entities, including several of his close friends, his company’s staff members, its advisors, customers, vendors, and local charities.

“This Office takes allegations of financial fraud and loan fraud very seriously,’ said U.S. Attorney McSwain. “As alleged, the defendant obtained millions of dollars from lenders and friends, only to spend it on his lavish personal lifestyle. My Office will continue to work with our law enforcement partners to protect innocent individuals and businesses from being victimized by fraud.”

"This defendant allegedly lived high on the hog for over a decade by fraudulently misrepresenting his business practices and prowess," said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "The FBI will continue to diligently investigate and hold accountable those foolish enough to engage in financial fraud."

If convicted, the defendant faces a maximum possible sentence of 935 years imprisonment, full restitution, a fine, and a period of supervised release.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Patrick J. Murray.                                                                    

An indictment, information or complaint is an accusation.  A defendant is presumed innocent unless and until proven guilty.