Elderly Investors Targeted by Pennsylvania Financial Advisor

by InvestorLawyers on October 22, 2012

in Arbitration,FINRA,Mutual Funds,Pennsylvania,Retirement,SEC,Securities Fraud

David L. Rothman, a Pennsylvania resident, has been charged by the Securities and Exchange Commission for allegedly defrauding elderly clients. Stock fraud lawyers say the civil and criminal charges accuse Rothman of sending his clients falsified account statements that inflated the value of their accounts. Then, in a repayment scheme, Rothman took funds from another client in order to repay those who received phony statements.

Elderly Investors Targeted by Pennsylvania Financial Advisor

According to the SEC’s complaint, the two clients were “elderly and unsophisticated investors” which, securities arbitration lawyers say, made them ideal targets for Rothman’s fraud. The complaint further alleges that the fraud occurred from 2006-2011 and the falsified statements “materially overstated” the value of the clients’ investments. In addition, allegations against Rothman state that once the investors realized the fraud had taken place, the financial advisor stated that he would repay the statements’ reported value. However, his financial resources eventually ran short.

Apparently, Rothman was previously censured by the CFP Board in 2004. This separate matter involved the purchasing of mutual fund Class S shares.

Stock fraud lawyers say that it is not enough for investors to simply read their account statements, but they should examine them thoroughly for indications of fraud. Many investment schemes take place over a long period of time. In this case, the scheme continued for five years and did not stop until the fraud was discovered by one of the clients. Diligence in examining statements can significantly reduce the amount of investor losses by discovering fraud sooner.

Though all investors should closely examine their account statements, elderly and retired investors are common targets for fraud. For more information on how elderly investors can be on the watch for fraud in their investment accounts, see the previous blog post, “Investment Fraud Red Flags for Elderly Investors.

If, after thoroughly examining your account statements, you believe you have been defrauded, find out more about your legal rights and options by contacting a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

 

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