State prosecutors issued an arrest warrant for Hale in early July 1996, charging that Hale had misrepresented the solvency of his insurance company, National Savings Life, to the state insurance commission. The prosecutors also alleged in court papers that Hale had made those misrepresentations to conceal the fact that he had looted the insurance company. Hale said that any infraction was a technicality and that no one had lost any money. In March 1999, Hale was convicted of the first charge, with the jury recommending a 21-day jail sentence.