A federal civil lawsuit alleges a prominent Denver minister is linked to more than $1 million in fraudulent life insurance claims.

The lawsuit filed Tuesday by AIG Life Insurance Co. says that among the fraudulent claims involving the Rev. Acen Phillips are one covering the death of his own brother and another on a woman linked to the missing Aarone Thompson.

The AIG suit alleges that Phillips and four other defendants altered beneficiary forms and falsely claimed people were enrolled in policies meant for Baptist ministers. Then two disbarred attorneys - including one of Phillips' sons - falsified the letterhead of a licensed attorney and tried to stymie the AIG investigation, the lawsuit claims.

"AIG is a multibillion-dollar insurance company with its own history with law enforcement," according to a statement released by Phillips' organization, American Church United. "They (AIG) have hired an ex-prosecutor to bully Bishop Phillips. The response to these various civil accusations will be responded to in court, not in the media."

AIG is the largest life insurance company in the United States.

"I told you what statement I made based on the attorney's advice," Phillips told investigative reporter Tony Kovaleski of Denver's 7 on Tuesday. Kovaleski first reported the questionable insurance policies.

Phillips added, "I cannot control what they (AIG) say."

For more than a month, Phillips has been criticized for life insurance policies he promoted that have not paid out benefits or were set to give him and his affiliates a large percentage of the proceeds. Yet, he is also regarded by some as a devout pillar of the black community who fights for the underdog.

Other lawsuit defendants include American Church United and New Birth Temple of Praise Community Baptist Church, where Phillips preaches. Also listed are Mount Gilead Baptist Church and its "Youth Job Mart."

The current pastor at Mount Gilead is another one of Phillips' sons, Del Phillips. He declined comment on the lawsuit but said Mount Gilead has no connection to American Church United.

"But unfortunately," he added, "my dad has historical connections (to Mount Gilead)."

In its lawsuit, AIG says its investigation found 12 fraudulent claims and the company has already paid seven of them to the tune of just over $639,000. More than half that money went to people and organizations connected to Phillips, including his sister-in- law, even though information provided policyholders indicated that 80 percent of proceeds would be paid to to surviving family members.

Another $450,000 has been claimed but not paid out, according to AIG. Of that, about half was set to go to people or organizations connected to Phillips, including $10,000 to Mount Gilead.

The seven cases cited in detail in the lawsuit use the initials of those who died and their survivors. But one case appears to be Shely Lowe, who was named as a person of interest in the disappearance of then 6-year-old Aarone Thompson of Aurora. Police believe Aarone was murdered.

Phillips spoke out on behalf of Lowe and her live-in boyfriend Aaron Thompson, Aarone's father. Lowe died on May 12, 2006. The unpaid, $100,000 life insurance claim on Lowe was set to provide $90,000 to two churches connected to Phillips and $10,000 to Aaron Thompson, who was also named by police as a person of interest in Aarone's disappearance.

No arrests have been made in the case and no body has been found. A grand jury is investigating.

An enrollment form falsely indicated Lowe was enrolled in a life insurance policy, according to AIG.

In the case of Phillips' brother, "RP" does not appear to have been an American Church United member, a necessary step for the life insurance policy. AIG paid out just over $100,000 on the policy - about $80,000 to the widow and $20,000 to American Church United.

The Colorado attorney general is investigating the Lowe insurance policy. Others who have had problematic policies connected with Phillips say they also have given statements to the Colorado Division of Insurance.

The AIG suit will not affect any criminal investigation and may even help because AIG indicates it has evidence of criminal wrongdoing such as theft and mail fraud, said legal analyst Scott Robinson.

"It looks like they've got the smoking gun documents," Robinson said, and later added, "To paraphrase Ricky Ricardo, Phillips has some explaining to do."

Jade Bozmans has previously clashed with Phillips on a life insurance claim for a family member that was never paid.

It is unclear if that case is among those cited in Tuesday's lawsuit and Phillips' attorney has previously said that Bozman's relative did not keep up his payments.

But Bozmans was saddened by the allegations in the lawsuit.

"I think they knew exactly what they was doing," he said, "and all those people are going to be left in the cold."

Breakdown of the allegation

How American Church United and the Rev. Acen Phillips defrauded AIG, according to the lawsuit:

• February 2005: American Church United seeks coverage for 608 Baptist ministers who are members of its organization.

• March 2005: Phillips drops the number of ministers to 258 and provides those names to AIG (although Phillips never intended to cover only ministers, but anyone who would become an ACU member).

• May 2005: ACU reports that 78 people drop out of the policy plan but adds 21 new ones, for a total of 201. The number of individuals continues to vary, but the new names are not listed.

One case study cited in the lawsuit:

July 2005: "RB" is a 24-year- old who dies in a "tragic accident." He is not an insured member of American Church United, but ACU sees an opportunity to put "RB" on the list of the 21 new but unnamed members added to the policy in May 2005.

Phillips falsely tells RB's mother she and her husband were the beneficiaries under the insurance policy.

ACU creates "several fraudulent documents" indicating RB was enrolled.

Phillips tells RB's mother that RB is covered for $100,000, with $80,000 going to the family and $20,000 to the church.

If RB had in fact been enrolled, the coverage would have doubled to $200,000 because the death was accidental and subject to a double indemnity provision. Phillips does not tell this to RB's parents.

RB's parents fill out a form in their dead son's name. They list RB's dad to receive 80 percent, or $80,000, and 20 percent, or $20,000, to two churches connected with Phillips.

That form is then altered by the defendants to give only 40 percent to the family.

AIG pays out $200,000. The Phillips churches now receive more than $120,000 (with interest), while the family receives $80,000 they believe they are entitled to when they should have received $160,000 if the policy was valid.

What's next

• The defendants will have 20 days from the time they are served with the lawsuit to respond. They may answer the claims, file counterclaims, or move to have the lawsuit dismissed.

If the suit moves forward, depositions would likely follow, leading to a trial or other resolution.Source: Legal Analyst Scott Robinson

kassj@RockyMountainNews.com or 303-954-2406

Back to Top