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Texas student insurance firm indicted in Va.

Tuesday - 4/9/2013, 5:30pm  ET

Associated Press

RICHMOND, Va. (AP) -- A Texas company that provided health insurance for Virginia Tech students has been indicted on 57 counts of racketeering, conspiracy, money laundering and fraud.

The indictment unsealed Tuesday in U.S. District Court in Abingdon, Va., accuses GM-Southwest Inc. and its former owner, 73-year-old John Paul Gutschlag, of fraudulently overstating claims paid on behalf of Virginia Tech by more than $9 million from 2003 through 2010. The inflated claims allegedly caused students and Virginia Tech to pay higher premiums.

Company officials did not immediately return a telephone message, and no phone listing could be found for Gutschlag in Frisco, Texas, where the company is based. Court documents do not list an attorney for the defendants.

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