Leonard A. Bramson launched his career in crime while he was a law student and went on to help carry out an elaborate family scheme that used bogus insurance companies to defraud customers of millions of dollars.
"It's one of the largest money-laundering schemes of this kind that we're aware of," said Assistant U.S. Attorney Geoffrey R. Garinther.
Bramson, 45, of Columbia acknowledged those facts yesterday as he pleaded guilty in U.S. District Court in Baltimore before Judge J. Frederick Motz to one count of money laundering in the family-operated insurance scheme. Federal prosecutors say he probably will face a nine- to 10-year prison sentence.
He agreed to help federal authorities find his brother, Martin A. Bramson, and father, Norman Bramson, who are fugitives in the case and believed to be hiding outside the country.
Martin Bramson fled from house arrest Oct. 26. Norman Bramson became a fugitive about the same time, fleeing from authorities after pleading guilty to currency violation charges.
Leonard Bramson was on trial Monday in New Jersey on separate federal felony charges when he suddenly pleaded guilty to one count of money laundering there, too. He faces a four-year sentence in that case.
The money laundering charge in Maryland stemmed from an investigation that estimated the proceeds of the fraudulent scheme at $10 million, most of which is believed to be in the family's many foreign bank accounts. Leonard Bramson agreed to return the money he controls.
But Mr. Garinther, who is prosecuting the case along with Carmina S. Hughes, said Bramson's father and brother probably have depleted most of the $10 million and authorities haven't determined how much Leonard Bramson can obtain.
The Baltimore Circuit Court appointed the Maryland state insurance commissioner as receiver for the 43 companies operated by the Bramson family in December. So far, it has recovered $645,000 and has identified an additional $3.7 million either paid into the court's registry or located in U.S. bank accounts.
Mr. Garinther said the government also will seek $800,000 in Bramson's personal assets, which he says were illegally gained in the scheme.
The prosecutor's statement said Leonard Bramson enlisted people to help the family with the scheme while at Thomas M. Cooley Law School in Lansing, Mich., in the early 1980s. One of those confederates, Kent Conshafter, also a Cooley graduate, pleaded guilty with him in New Jersey.
Leonard Bramson's responsibility in the organization was to transfer money from the insurance scams to 240 banks worldwide, the statement said.
Leonard Bramson and his family members carried out the fraud by forming insurance companies to sell malpractice policies to doctors who were deemed high risks because of previous problems, according to the statement.
But the company denied coverage to doctors seeking protection for costly claims, using loopholes written into the policies to avoid payment, the statement said. The family used various names for the companies and the individuals used many aliases themselves.
Leonard Bramson was also known as Peter Brock, L. Allen Bramson and Allen Bramson.
Family members circumvented U.S. insurance regulations by setting up insurance companies in such places as the British Virgin Islands, the Federated States of Micronesia and the Bahamas.
The companies submitted false licensing certificates to U.S. officials to establish that they were permitted to operate in other places.
The family first targeted podiatrists, using its company, International Bahamian Insurance, to solicit medical malpractice business, the statement said.
It later targeted other specialists, using Professional Risk Insurers Management Exclusive as the front company.