The Office of the United States Attorney for the District of Vermont stated that Kenneth MacKay, 36, of 88 Callaway Drive, Williston, was arrested and charged in a criminal complaint with engaging in a scheme to commit bank fraud, wire fraud and money laundering involving over a million dollars he embezzled and stole from his employer, Willis Management (Vermont) Ltd. and clients of Willis. MacKay appeared today in Federal Court and was released on various conditions, including that he surrender his passport.

In connection with MacKay’s arrest, the United States also obtained seizure warrants authorizing it to seize five 529 Qualified Tuition Plans that MacKay opened for his children and funded with some of the money he embezzled and stole. These accounts contain approximately $240,000. The United States also filed civil forfeiture actions seeking forfeiture of MacKay residence in Williston and a condominium MacKay recently purchased in Orlando, Florida. The civil complaints allege that MacKay obtained these properties in whole or in part with funds he illegally obtained through his frauds. The Williston property is shown on the Williston grand list to be valued at $1,934,600. The Florida condominium was purchased on February 8, 2008 for $238,000.

According to the affidavit of FBI Special Agent William McSalis in support of the criminal complaint, the seizure warrants and the civil forfeiture actions, between February 2004 and February 2008, MacKay engaged in a scheme to fraudulently obtain millions of dollars from his employer, Willis Management ( Vermont) Ltd., and its clients and affiliated companies. As part of his scheme and to facilitate it, MacKay created a shell corporation and opened accounts at the Chittenden Bank in Vermont. Generally, through various schemes, MacKay would cause monies to be deposited into bank accounts he controlled though his employment and then divert some or all of this money for his personal use either directly or through the shell corporation he created. The complaint further alleges that through his various fraudulent schemes, MacKay diverted over $2.2 million to his personal use. MacKay then attempted to launder this money through his shell corporation, RCM Financial, and by using the money to build a residence in Williston, Vermont and purchase a condominium in Orlando, Florida.

MacKay’s ongoing scheme was recently discovered by management at Willis, who promptly contacted the FBI. Willis Management ( Vermont) Ltd. is a Vermont corporation engaged in the business of managing captive insurance companies. It is a subsidiary of Willis North America (“WNA”), which in turn is a subsidiary of Willis Group Holding Ltd. (“Willis”), a publically traded corporation headquartered in New York City. The captive insurance industry is regulated by the Vermont Department of Banking, Insurance, Securities & Health Care Administration (BISHCA), which was also notified by Willis of MacKay’s fraudulent activities. BISHCA has commenced its own regulatory inquiry into MacKay’s activities and the overall impact, if any, on Vermont companies.

United States Attorney Thomas D. Anderson praised the work of the FBI, which quickly unraveled a complex fraud scheme, arrested MacKay, and seized assets obtained by MacKay through his fraud. U.S. Attorney Anderson also commended Willis and the Chittenden Bank for their ongoing cooperation in the investigation.

U.S. Attorney Anderson also cautioned that charges in the criminal complaint are accusations only and that MacKay is presumed to be innocent unless and until proven guilty.