According to the Justice Department, an Ohio investment advisor was indicted for stealing more than $9.3 million from victims during a multi-year Ponzi scheme.
Former consultant Raymond A., 50, of Avon, Ohio. Erker was convicted this week after a seven-day trial in Cleveland. During the investigation, it was revealed that one of his alleged victims, a former prosecutor and judge, wore a hidden wire to tape a confession from the adviser, according to local outlets.
Previously, Erker was a state-registered representative, although the Ohio Division of Securities revoked his license in 2012, because he “disclosed material changes and nondisclosureable matters” on certain documents, “has a good business reputation”. showing a lack”, according to Erker advisorinfo page, Prior to this, Erker worked for Merrill Lynch and had a seven-year stint with LPL, before owning and operating Sagegaard Wealth Management (among several Sagegaard entities) until 2019.
According to the DOJ’s indictment, Erker, as well as co-defendants Kevin Krantz and Tara Brunst, began the scheme in January 2013 influencing at least 54 investors (both Krantz and Brunst previously pleaded guilty). The trio urged clients to invest in the companies Gensource and Provident, assuring investors that they were buying annuities and senior secured notes “without the risk of loss and with guaranteed rates of return.” He said the proceeds would be used for safe investments that would result in a guaranteed lifetime income payout.
But no company had authority to issue annuities, and provident notes issued to customers were not protected by any real assets; According to the indictment, Erker, Krantz, and Brunst instead used investor funds to pay off Erker’s Sageguard entities, Erker’s personal bank accounts, and previous investors in a Ponzi-like style. According to the indictment, the trio did not even tell investors that they had ownership interests in both GenSource and Provident.
To hide evidence of the plan, Aker and his co-conspirators set up fronts in Nevada and Delaware, employ call centers, and create fake content (including brochures and websites) as well as fake account balances for customers. To maintain communication with victims through in-person meetings, phone calls, mail and email, according to the DOJ.
One of these victims was Paulette Lilly, a former judge for Lorraine County, Ohio. According to Chronicle Telegram, Lilly had served as a judge for 12 years, and previously served as an assistant Lorraine County prosecutor for six years. He is currently the Chief Assistant Criminal Prosecutor in the Erie County Prosecutor’s Office.
Lilly represented Erker in a divorce case before investing (and losing out) about $200,000 in a Ponzi scheme, As reported by Cleveland.com, In November 2018, Lily agreed to work with police and wear a hearing aid when meeting Erker at a restaurant in which, according to prosecutors, Erker accepted her role.
According to Cleveland.com, in a tape of the meeting played during the trial, Erker told Lily that she had “f*cked up” and that she “had every right to sue me, put me in jail”. Erker’s attorney Edwin Vargas during the trial stated that while Erker failed his clients, he never intended to defraud them. When responding to a . WealthManagement.com Requesting comment, Vargas said the jury did not reach a unanimous consensus at lunchtime yesterday, but was given further instructions by the judge and eventually returned a guilty verdict.
“You are disappointed, but we have to prepare for the punishment,” Vargas said of the verdict. “This is the next task before us.”
Other alleged victims have emerged in recent years, along with Margaret Whelan, a 72-year-old woman. cleveland 19 telling news In 2020 that Erker stole money for a career as a nurse that spanned nearly four decades.
Krantz and Brunst still await sentencing after pleading guilty, while Erker is to be sentenced on July 7. He faces an estimated sentence of 27 to 34 years in prison, although the judge who handed down the sentence will have the final say on the outcome.
