Investors Beware: Fraudsters May Have Nine Lives
If you’re like most investors, when you hear that a broker or advisor
has been barred or suspended from the securities industry, you believe
the threat posed by that person has been removed. Sadly, this isn’t
always the case.
Fraudster Frank Bluestein, for example, was sanctioned for defrauding investors
during the credit crisis. According to the SEC, Bluestein was the single
largest salesperson in
Edward May’s $350 million Ponzi scheme. He allegedly raised around $74 million from more than 800 investors by
making a variety of
misrepresentations and omissions to potential investors.
“Bluestein convinced elderly investors to refinance their homes to
invest in securities that he falsely claimed were safe,” said Merri
Jo Gillette, Director of the SEC’s Chicago Regional Office. “His
lies, false assurances, and unscrupulous tactics put many investors at
risk of losing not only their life savings, but also their homes.”
Though Bluestein has been suspended from the securities industry, he hasn’t
exited the investment world. Instead, he is one of many barred or suspended
financial professionals now holding themselves out as
“investment coaches,” “wealth coaches,” and/or
“investment teachers.” InvestmentNews reporter Bruce Kelly says Bluestein is connected to several
online trading websites, and that he also appears in a YouTube video about
Educated investors who come across Bluestein online may know to run him through
BrokerCheck (which shows he has had well over 100 customer disputes levied against
him). Less savvy investors, however, may see him only as an intelligent
teacher – never guessing that he played a key role in the largest
Ponzi scheme in Michigan history.
Bluestein’s reinvention of himself is nothing new. Many “barred
brokers with disreputable histories often find it hard to give up the
potential easy money of selling investment strategies or products,”
Investors who want to protect themselves against such fraudsters should
be particularly vigilant about investigating anyone they consider doing
business with. Understanding theins and outs of financial credentials and
investment industry designations also helps. For more
tips on choosing an advisor or broker, click here.
About our law firm:
Meyer Wilson represents individuals across the country who have been harmed
by investment fraud. All of our cases are handled on a contingency fee
basis and we never request a retainer of any kind. Contact us for more
information or complete the online form on the top of this page and we
will respond promptly.