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Frisco insurance exec pleads not guilty in Va.

🕐 1 min read

ABINGDON, Va. (AP) — The former owner of a Texas company that provided health insurance to Virginia Tech students has pleaded not guilty to racketeering, conspiracy, money laundering and fraud charges.

Records show 73-year-old John Paul Gutschlag Sr. entered his plea Tuesday in federal court in Abingdon. A jury trial was set to start Sept. 23. Gutschlag was released on $10,000 unsecured bond.

A 57-count federal indictment accuses Gutschlag and GM-Southwest Inc. of overstating claims by more than $9 million to boost profits.

The Frisco, Texas-based company is a third-party administrator of student health insurance. Major insurance carriers provide coverage but pay GMS a fee for collecting premiums and paying claims. The indictment says that by overstating claims, GM was able to charge higher premiums and discourage competitors from bidding to provide the service.  

Robert Francis
Robert is a Fort Worth native and longtime editor of the Fort Worth Business Press. He is a former president of the local Society of Professional Journalists and was a freelancer for a variety of newspapers, weeklies and magazines, including American Way, BrandWeek and InformatonWeek. A graduate of TCU, Robert has held a variety of writing and editing positions at publications such as the Grand Prairie Daily News and InfoWorld. He is also a musician and playwright.

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