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US Fidelis Owners Indicted on Multiple Felony Charges

June 17, 2011

JEFFERSON CITY, Mo.—A St. Charles County grand jury handed down a 14-count indictment against Darain Atkinson and a 13-count indictment against Cory Atkinson, the brothers who owned and operated US Fidelis. US Fidelis was formerly known as National Auto Warranty Services and did business under the name “Dealer Services.”

The indictments include felony charges of unlawful merchandising practices, stealing and insurance fraud. Attorney General Chris Koster and his office, working in coordination with St. Charles Prosecuting Attorney Jack Banas, requested the indictment and will prosecute the case.

According to the indictments, the Atkinsons and their company sold vehicle repair coverage under both vehicle extended service contracts and contracts associated with various vehicle products.

The indictments allege that the Atkinsons kept refunds that were due consumers, charged fees in excess of the amount stated in the contract and told consumers they would get a pro rata refund if they canceled the contract, while intending to keep a portion of any refund.

The indictments further charge that the Atkinson brothers misled consumers into believing the company was affiliated with auto manufacturers and dealers, the consumer’s warranty had expired or was about to expire and that the consumer had the opportunity to extend or reinstate the manufacturer’s warranty.

According to the indictments, the Atkinsons also falsely represented to consumers that all vehicle repairs were covered, and concealed from consumers the fact that the coverage contained liability limits and other conditions and exclusions from coverage.

The indictments also allege that Darain Atkinson is a prior offender as a result of a 1986 conviction of theft, forgery, and burglary in Kansas. He was also convicted by the U.S. District Court of Kanas in 1987 manufacturing counterfeit Federal Reserve Notes. Cory Atkinson also is a prior offender as a result of a 1997 felony criminal trespass conviction in Colorado.

If convicted, and because of his status as a prior and persistent felon, Darain Atkinson could face a term of up to life in prison. If convicted on the most serious count, Cory Atkinson could face a term of up to 15 years in prison.

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