Lindberg appeals, seeks to block sales linked to $1.6B restitution order

Former top NC political donor Greg Lindberg filed multiple appeals Thursday after being sentenced in May to 12 years in federal prison and ordered to pay more than $1.6 billion in restitution related to an insurance fraud scheme.

Lindberg filed an additional emergency motion Thursday seeking to block any sales of his assets related to the restitution order. The motionquestions the actions of the special master dealing with the restitution issues.

“Congress has spoken with precision about what a special master may do in a federal criminal restitution proceeding, and it is not this,” Lindberg’s lawyers wrote. “The only express authority for a special master in this setting is 18 U.S.C. § 3664(d)(6), and its text is narrow: the court ‘may refer any issue arising in connection with a proposed order of restitution to a magistrate judge or special master for proposed findings of fact and recommendations as to disposition, subject to a de novo determination of the issue by the court.’”

“De novo” means the trial judge would consider the issue himself without deferring to the special master.

“A special master may propose; only the Court may decide; and nothing in the statute empowers a master to liquidate a defendant’s assets — least of all before any final restitution determination exists,” Lindberg’s lawyers wrote.

US District Judge Max Cogburn sentenced Lindberg on May 26 in connection with two separate federal cases. One involved a conviction on charges related to Lindberg’s attempt to bribe state Insurance Commissioner Mike Causey after the 2016 election. The second involved a guilty plea to charges arising from a multibillion-dollar insurance fraud case. The fraud funded Lindberg’s “lavish” lifestyle with “private jets, mansions, and a 200-foot luxury yacht,” according to court records.

Given time Lindberg already has served behind bars, he could be free by 2034.

Meanwhile, Wake County’s next district attorney, Wiley Nickel, has promised to launch an investigation into possible state criminal charges linked to Lindberg’s activity after Jan. 1.  

“According to court documents and evidence presented in court, from at least 2016 through at least 2019, Lindberg conspired with others to defraud various insurance companies, other third parties and hundreds of thousands of insurance policyholders,” according to a US Justice Department news release. “Lindberg and others conspired to deceive the North Carolina Department of Insurance (NCDOI) and other regulators, evaded regulatory requirements meant to protect policyholders, concealed the true financial condition of his companies and improperly used insurance company funds for his personal benefit.”

“Lindberg and his co-conspirators caused companies he controlled in North Carolina, Bermuda, Malta, and elsewhere to invest more than $2 billion in loans and other securities with his own affiliated companies and laundered the proceeds of the scheme,” the news release continued. “Lindberg directed the scheme and personally benefitted from the fraud in part by ‘forgiving’ more than $125 million in loans to himself from the insurance companies that he controlled. Lindberg used his ill-gotten gains to fund a lavish lifestyle, buying private jets, mansions and a 200-foot luxury yacht.”

“To carry out these conspiracies, Lindberg and others engaged in circular transactions among Lindberg’s web of entities using insurance company funds and misled or omitted material information from regulators, various ratings agencies, insurance companies and ultimately policyholders, regarding these transactions,” the news release added.

“As Lindberg’s fraud and money laundering conspiracies were beginning to unravel, from April 2017 to August 2018, Lindberg and others engaged in a bribery scheme for the purpose of causing the Commissioner of Insurance of the NCDOI to take official action favorable to Lindberg’s company, GBIG,” according to the release. “Lindberg and others gave the Commissioner millions of dollars in campaign contributions and other things of value in exchange for the removal of NCDOI’s Senior Deputy Commissioner, who was responsible for overseeing the regulation and the periodic examination of GBIG.” 

“As a result of Lindberg’s conduct, his insurance companies, third-party entities, and policyholders suffered substantial financial hardship, and multiple of his insurance companies have been placed in rehabilitation and liquidation,” the release continued. “To date, thousands of individual policyholders and other victims are collectively still owed more than $1 billion.”

Lindberg will get credit for more than three years he has served behind bars. He had filed paperwork in May asking Cogburn to limit the additional time he would have to spend in prison.

After his first conviction in the bribery case in 2020, he spent 633 days in prison. The 4th US Circuit Court of Appeals threw out that conviction, and Lindberg was convicted a second time in May 2024.

By his new sentencing date, Lindberg had served an additional 561 days behind bars, according to his court filings. He pleaded guilty in November 2024 and surrendered to federal marshals in the insurance fraud case. He served time in the Gaston County jail and in two county detention centers in Kentucky.

Special master Joseph Grier is working in the fraud case to address restitution. An April report suggested Lindberg could pay more than $1.6 billion in restitution. Grier filed a 35-page report in May addressing restitution in the “massive insurance fraud conspiracy.”

Of eight names listed as possible recipients of restitution, more than half of the money ($821 million) would be designated for CBL, an insurance company with 122,485 policyholders. Another $406 million would go to the PBLA and ULICO insurance companies.

In the bribery case, Lindberg, John Gray, John Palermo, and a fourth defendant were joined for the original trial in February and March 2020. The other defendant, former state Republican Party Chairman Robin Hayes, entered a guilty plea before the trial. Then-President Donald Trump pardoned Hayes in January 2021. A jury acquitted Palermo.

The original jury convicted Lindberg and Gray. Lindberg faced a seven-year prison sentence. Gray was sentenced to 30 months in prison. The 4th US Circuit later threw out both convictions in June 2022 because of problems related to jury instructions.

Before the legal action against him, Lindberg had attracted attention as a top donor to political campaigns in North Carolina. He supported Democratic Insurance Commissioner Wayne Goodwin’s unsuccessful 2016 re-election bid. Goodwin lost to Causey.

Later Lindberg became the largest financial contributor in 2017 to the NC Republican Party and two groups supporting then-Lt. Gov. Dan Forest, a Republican. Forest lost the 2020 governor’s race to the incumbent Democrat, Gov. Roy Cooper.

“Lindberg appeals, seeks to block sales linked to $1.6B restitution order” was originally published on www.carolinajournal.com.