orporation ("UDC"), which conducted business through its subsidiaries, Associated Life Insurance Co. ("Associated") and United Fire Insurance Co. ("United Fire"). Hoffenberg later became chairman of the boardi of UDC, Associated and United Fire. Hoffenberg obtained the Illinois Department of Insuran

e stocks were purchased with funds borrowed by using insurance company bonds as collateral. Hoffenberg concealed his activities from Associated and United Fire by: routing all securities trade confirmations, periodic account statements and other communications from brokerage firms to Towers, rather than t

Epstein came up with the idea of financing these bids through Towers' acquisition of two ailing Illinois insurance companies, Associated Life and United Fire. `He was hired by us to work on the securities side of the insurance companies and Towers Financial, supposedly to make a profit for us and for the

argets. Meanwhile, in order to throw the insurance regulators off, the $1.8 million was reported as being safely invested in a money-market account. United Fire’s former chief financial officer Daniel Payton confirms part of Hoffenberg’s account. He says he recalls making one or two telephone calls to Epstein (

mpanies funds. 32. Hoffenberg caused Associated and United Fire to issue or deliver insurance policies at a time when he knew that Associated and United Fire were insolvent or impaired in violation of Section 144.1 of the Illinois Insurance Code. (I11. Rev. Stat. Ch. 73 I 756.1 (1987). -8- Ron 'd NY I

Epstein came up with the idea of financing these bids through Towers's acquisition of two ailing Illinois insurance companies, Associated Life and United Fire. "He was hired by us to work on the securities side of the insurance companies and Towers Financial, supposedly to make a profit for us and for the

davit, annexed hereto, Epstein misappropriated the proceeds for not only his personal use, but also to start his own company, Defendant TFTC. 33. United Fire and Associated lost over one million dollars ($1,000,000) on the purchase of Emery securities, due to the fact that the stock was purchased with fun

e stocks were purchased with fupds borrowed by using insurance company bonds as collateral. Hoffenberg concealed his activities from Associated and United Fire by: routing all securities trade confirmations, periodic account statements and other communications from brokerage firms to Towers, rather than t