Houston RIA charged in $1.9M elder swindle gets five years

Texas regulators say Lawrence DeShetler bilked five clients, two of whom were in their 80s

Nov 2, 2017 @ 5:25 pm

By InvestmentNews

A federal judge in Texas sentenced state registered investment adviser Lawrence Allen DeShetler to 60 months in prison and ordered him to pay restitution of $948,058 for defrauding clients of $1.9 million.

After an investigation by the Texas State Securities Board, Mr. DeShetler pleaded guilty in June to federal mail fraud charges. The state found that the RIA, based in The Woodlands, had convinced five elderly clients — two of whom were in their 80s — to cash out legitimate investments and transfer the money to him so he could get them higher returns. Instead, he deposited the money into bank accounts over which he had sole authority.

More: Ex-Merrill broker Thomas J. Buck pleads guilty to securities fraud

Before the restitution order, local and federal law enforcement authorities seized Mr. DeShetler's bank accounts and took other steps to return approximately $857,000 to investors, Texas securities regulators said in a release.

Regulators said Mr. DeShetler spent some of the money he took from clients on run-of-the-mill expenses like restaurant and bar tabs, country club fees, clothes, and pool cleaning services. He also used some of the funds to make a down payment to begin construction on a house in Nicaragua.


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