Funding New Texas Insurance Company Proves Problematic

mulebriarTwo Brownsville men with a history of regulatory complaints about their insurance businesses have been indicted on securities fraud and theft charges related to the sale of a $1 million investment contract that was supposed to help fund a new insurance company called Nafta Holdings LLC. In case you’re wondering, the proposed company had nothing to do with the North American Free Trade Agreement. 

A Cameron County grand jury issued new indictments  against two Brownsville men for securities fraud and theft of property of more than $200,000. Alberto Alba Villarreal and Daniel Thomas Hernandez allegedly sold a $1 million “membership interest” – an investment contract — in Nafta Holdings LLC. The money was supposed to help fund a new insurance company.

The indictments allege that Villarreal and Hernandez failed to disclose to their investor that the assets of Nafta Holdings were 100% pledged to First National Bank, and they overstated the amount of the money that would be needed to create the insurance company. Villarreal and Hernandez also used the investor’s money to pay their personal expenses and to pay outstanding insurance claims of existing companies the men owned or controlled, according to the indictments.

The Texas Department of Insurance in 2010 revoked the General Agent License of Nafta General Agency Inc., a company Villarreal and Hernandez were involved in. The revocation was not related to the allegations that led to the indictments.

See: http://rrunrrun.blogspot.com/2014/06/nafta-holdings-million-scam-villarreal.html

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