Unlicensed investment adviser receives sentence

Understanding the financial markets may seem like a foreign language for many Florida readers. For that reason, individuals who wish to plan for their future often place their trust in a financial planner, adviser or stockbroker.

That trust comes with certain legal protections: both federal and state laws charge a stockbroker with a duty to accurately report financial information to investors. Stockbrokers are also prohibited from stock market manipulation. Brokers or firms that violate applicable securities laws may face both criminal charges for their misconduct and a civil lawsuit brought by wronged investors. Regarding the latter, a securities fraud attorney might have strategies and advice for how to hold financial professionals accountable for any breaches of trust or ethical conduct.

In today's story, a man who had been operating as an unlicensed investment adviser in Florida was recently sentenced to more than three years in federal prison. He also was ordered to pay almost $2.3 million to the victims of his investment fraud scheme.

According to an FBI investigation, the man was implicated in an investment fraud scheme involving at least 21 investors. The victims gave the man approximately $3.1 million to invest in US Treasury securities. However, the man admitted to misrepresentation or nondisclosure of material information about the investment scheme.

In reality, he only used half of the $3.1 million for actual investments. The rest of the investors' money apparently went toward the man's personal expenses. To make matters worse, the funds in which the man actually did invest lost around $700,000. The investment fraud lasted more than five years.

Source: newsrecord.org, "Former UC Employee Imprisoned," Benjamin Goldschmidt, Feb. 21, 2013

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