Earlier this week, former Ohio broker John Schmidt was charged by the Securities and Exchange Commission (SEC) for defrauding his elderly retail brokerage clients out of more than $1 million in a long-running scheme.
According to the SEC's complaint, Schmidt allegedly participated in selling securities belonging to at least seven of his former clients and secretly transferred more than $1 million in proceeds to accounts belonging to 10 other clients. He was able to carry out the suspected scheme by allegedly taking part in unauthorized sales and by making withdrawals from his client's variable annuities. Also, the SEC claims that Schmidt secretly transferred funds using fake letters of authorization and issuing false account statements. Most of the clients claiming to be affected by his scheme were vulnerable elderly customers. In total, the SEC states that Schmidt received more than $230,000 in brokerage commissions from the elderly clients.
The SEC's original complaint was filed in federal district court in the Southern District of Ohio and is charged with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5. The SEC is requesting a judgment that would require Schmidt to pay civil penalties and disgorge the money he fraudulently received from his elderly clients.
Prior to becoming charged, Schmidt worked as an investment broker with Wells Fargo Advisors Financial Network in Dayton, Ohio from 2006 to 2017. He was terminated from his position in November 2017, according to his BrokerCheck report.
Did You Lose Money While Investing with John Schmidt?
If you lost money investing with John Schmidt, Meyer Wilson may be able to assist you to recover your losses. Give our office a call today at (800) 738-1960 to speak to one of our experienced investment fraud attorneys.