JEFFERSON CITY - Darain Atkinson, one of the two brothers who co-owned and operated US Fidelis, pleaded guilty to misleading customers in the St. Louis area and nationally.
Missouri’s Attorney General Chris Koster’s announcement outlined a range of violations, including keeping refunds owed to customers; leading customers to believe that contracts covered more vehicle repairs than they actually did; using deceptive practices to avoid state laws related to insurance or service contracts; and leading consumers to believe that US Fidelis was affiliated with automakers and dealers when this was not the case.
Atkinson now faces an eight-year sentence for each of the first two counts (stealing consumers’ refunds and insurance fraud) and four years for the third count, consumer fraud. Atkinson’s trial is set for Sept. 4, reported F&I and Showroom magazine.
US Fidelis, a direct-to-consumer provider of vehicle service contracts, originally came under investigation in 2008, when then-Attorney General for Pennsylvania (now governor) Tom Corbett claimed that the company systematically ignored federal Do-Not-Call rules, among other violations.
In June, 2011, a St. Charles County grand jury handed down a 14-count indictment against Darain Atkinson and a 13-count indictment against his brother Cory Atkinson, including charges of unlawful merchandising practices, stealing and insurance fraud.
In July, 2011, Missouri Governor Jay Nixon signed a new law that targets auto service contract businesses engaging in deceptive practices to sell extended service contracts.
