Arnett Waters, of Milton, MA, Barred From Securities Industry for Rare Coin Ponzi Scam
Milton, Massachusetts Man Barred from Securities Industry after Pleading Guilty to Criminal Charges of Securities Fraud Over Rare Coins Ponzi Scheme
A Milton investment advisor and broker-dealer was barred from the securities industry this month after pleading guilty to 16 counts in a criminal securities fraud case.
On Nov. 29, Arnett L. Waters, of Milton, Mass., pled guilty to seven counts of securities fraud, six counts of mail fraud, two counts of money laundering, and one count of obstruction of justice in connection to a large-scale Ponzi scheme involving rare coins. On Dec. 3, the SEC issued an order permanently barring Arenett Waters from the securities industry. The order was based on Waters’ guilty plea.
Criminal prosecutors in the case had alleged that Waters fraudulently obtained millions of dollars from investors by selling coins at inflated prices over a period of ten years.
“Waters convinced customers to buy coins at prices that, on average, represented a 600% mark-up from market value of the coins,” wrote the U.S. Attorney’s Office for the District of Massachusetts. “Waters also induced coin purchasers to return coins to him, on the false pretense that he would sell those coins on the customers’ behalf. In the case of one victim, who had paid Waters over $7 million for coins, Waters convinced the victim to pay over half a million dollars for fees purportedly related to the sale and storage of the coins. In fact, Waters had already sold most or all of the coins and had used the proceeds for his own personal and business expenses.”
The charges filed against Waters in criminal court were based largely on accusations filed against Waters in a May SEC civil lawsuit.
In the suit, the SEC alleged that Waters and two companies under his control, broker-dealer A.L. Waters Capital, LLC and investment adviser Moneta Management, LLC, defrauded investors, including his church, over a period of at least three years.
Waters also allegedly misappropriated investor funds and used them for his personal purposes.
In addition to the SEC’s injunction, Waters faces decades in prison and millions of dollars in fines for his actions. Sentencing on all criminal charges is scheduled for April. He has been in police custody since Oct. 2.