By BRENT MARTIN
St. Joseph Post
A St. Joseph man has pleaded guilty to leading an $8 million wire fraud conspiracy that cheated hundreds in the guise of running a Christian health care sharing ministry.
Federal prosecutors say 61-year-old Craig Anthony Reynolds waived his right to a grand jury and pleaded guilty before U.S. District Judge Greg Kays to one count of conspiracy to commit wire fraud and one count of making false statements on a tax return.
Reynolds admitted he and his partners used false promises to market Medical Cost Sharing. Reynolds, CEO of the tax-exempt organization, admitted it collected more than $8 million in member “contributions,” yet paid only 3.1 percent in health care claims. Reynolds and his partners pocketed the rest.
The co-conspirators included an executive vice president and chairman of Medical Cost Sharing, who ran the organization with Reynolds. This co-conspirator, identified in court documents as “CC1,” has not been charged.
Reynolds marketed Medical Cost Sharing as a “Christian Health Care Sharing Ministry” through insurance brokers, radio stations, social media, and its website. The Medical Cost Sharing website claimed, “while we are not an insurance company, many think of us as a Christian Health Insurance, or Christian Medical Insurance because, like conventional insurance plans, we help you pay your healthcare costs. We help you protect your family. But unlike these corporate, profit based plans, we are a healthcare sharing ministry … your healthcare costs are shared with other Christians enrolled in our medical sharing plans.”
Reynolds confessed in court Medical Cost Sharing rarely paid members’ health care claims, only paying a portion of the claim if a member filed a complaint with their state attorney general and/or hired an attorney to represent them against Medical Cost Sharing.
Prosecutors say that the plea agreement disclosed Medical Cost Sharing collected more than $8,035,544 in member contributions from 2015 through 2022 and paid no more than $245,982 in claims.
Medical Cost Sharing paid no claims at all from February 22nd of 2021 to December of 2022.
Federal agents served search warrants on the Medical Cost Sharing business location and Reynolds’s residence and seized property generated from Medical Cost Sharing proceeds in late 2022. Medical Cost Sharing continued to try to collect membership dues until the court entered a temporary restraining order against the company.
Under the plea agreement, Reynolds must forfeit his gain from Medical Cost Sharing as well as any property obtained from his criminal activity, including two residences in St. Joseph, the contents of his bank account, and a 2022 Harley Davidson motorcycle. He must also pay $167,799 in restitution to the government.
Reynolds has not been sentenced, yet. He could serve up to 23 years in federal prison.
FBI Website for Victims of Medical Cost Sharing Fraud
Those who believe they are victims of this fraud and wish to receive restitution for any losses suffered as a result may provide their information through the MCS Victim Information Page that has been established by the FBI.