Thomas Edward Andrews, formerly a stockbroker with LPL Financial, is currently serving time in federal prison after pleading guilty to securities and mail fraud. The Securities and Exchange Commission has recently charged him with investor fraud, claiming he misappropriated more than $8 million from 23 investors from 2010 through 2015.
On April 5, the SEC filed a complaint in a Utah federal court alleging that Thomas Andrews defrauded investors by convincing them to liquidate their investments and put their money into fictitious investment accounts called “the Jackson Trust” and “the Lincoln.” He claimed these accounts were guaranteed to provide a good return on their investments.
These accounts were actually bank accounts that Thomas Edwards would use to transfer funds to himself, the SEC complaint alleges.
According to the SEC, Thomas Andrews misappropriated more than $8 million from the investors. He also allegedly paid his former assistant Scott Christensen $1 million for his assistance in perpetuating the investor fraud.
“From 2010 until the fall of 2015, Andrews spend the investor funds on personal items such as cars, mobile homes, alimony, trips to Disneyland, guns, dining out and numerous stays at luxury resorts in California,” the investor fraud lawsuit states.
The victims of the investment fraud scheme reportedly included Utah residents from a rural community, most of whom were unsophisticated in securities, the SEC complaint states.
“Almost all of Andrews’ victims were people he had known while growing up in Nephi, Utah,” the SEC’s investor fraud lawsuit states. “These individuals were unsophisticated in investment matters and accustomed to doing business on a handshake.”
In December 2016, Thomas Andrews was sentenced to 97 months in prison and was ordered to pay more than $8.34 million in restitution.
Scott Christensen is also reportedly serving time in prison for securities fraud and for making a false statement to a federal agent. He was ordered to pay $1 million in restitution.
How to Avoid Investor Fraud
Investor fraud can have devastating effects on unsuspecting investors and their finances. Despite laws and regulations designed to protect investors from stockbroker misconduct, there are unscrupulous stockbrokers who seek to take advantage of inexperienced investors.
Be careful before you invest. A good rule of thumb is that if something seems too good to be true, it probably is. Ask questions and do some research before you entrust your hard-earned money to a stockbroker. A trustworthy stockbroker will respect your desire to take your time before making a decision and won’t pressure you to act right away.
Some stockbrokers come across as trustworthy and likeable but use these traits to trick investors into making poor decisions. Before you invest, check out the person’s qualifications to make sure you don’t become the victim of a scam.
If you suspect you have fallen victim to investment fraud, contact the experienced investor fraud attorneys at MeyerWilson to learn about your legal options. Our team of investment fraud lawyers will help you understand your rights and seek to recover any financial losses you may have suffered. Call us today or fill out our online form to request a free case evaluation.