Joe Bonnett Life Insurance Policy Faces Legal Hurdle

Joe Bonnett Life Insurance Policy Faces Legal Hurdle

Joe Bonnett, an Omaha investment adviser, was accused earlier this year of running a Ponzi scheme for nearly a decade. He took his own life in May of 2016 as the investigation began to indicate that he may have defrauded investors as much as $1.35 million. He allegedly paid off previous investors with money obtained from new clients, including members of his own family.

Recent revelations indicate that the number of people affected by Bonnett’s scheme was limited, contradicting earlier assumptions that a large number of people lost money because of Bonnett’s actions.

Following his death, questions over what will happen to Bonnett’s $3.2 million life insurance policy have become a sticking point in the case. A court-appointed receiver filed papers with the court requesting that Douglas County District Judge Duane Dougherty order that the money from the policy be used to pay back the victims. Domina Law Group’s David Domina who is representing one of the policy's beneficiaries, filed papers with the court stating that the proceeds from the life insurance policy belong to the named beneficiaries. In an interview with the Omaha World-Herald, Domina said:

“If life insurance beneficiary designations are not honored, life insurance becomes a very risky proposition.”

Eight of the victims involved in Bonnett’s alleged Ponzi scheme are named as beneficiaries on the life insurance policy, but investigators believe there may be another 6 or so investors not named as beneficiaries.

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