A former financial adviser with Ameriprise Financial Services Inc. was sentenced to three and a half years in prison and ordered to repay more than $3 million he allegedly stole from investors and used for personal expenses, including paying off his gambling debts, according to the U.S. Attorney's Office for the Northern District of Illinois.
From around 1996 to late 2007, Oscar Donald Overbey Jr., 47, pocketed approximately $4 million of client money instead of investing it as promised, according to court documents.
In one instance, he convinced two university workers and their daughters to invest $150,000 in a government-backed investment that supposedly provided 10% returns. The victims refinanced their home to make the investment, but Mr. Overbey used the money instead to pay personal expenses and to make “10 Ponzi-type payments to other victims,” the U.S. Attorney's Office said.
U.S. District Court Judge Gary S. Feinerman imposed the sentence Oct. 2.
Mr. Overbey was indicted in July 2012 and pleaded guilty to felony charges of wire fraud in last February, according to court documents.
During sentencing, a doctor expressed the opinion that Mr. Overbey is a pathological gambler. During one year, federal authorities accused Mr. Overbey of being in a casino for 323 days.
When Mr. Overbey was arrested by the federal government in November 2012, he was taken into custody at the Majestic Star Casino in Indiana.
“A lot of my brokerage clients were gamblers and a lot of gamblers that I knew became clients,” Mr. Overbey reported to the doctor, according to court documents. “We loaned money back and forth at the tables. The lines between my brokerage business and my gambling were often blurred. I was at the casino all the time.”
He was barred from the industry in 2007, according to Financial Industry Regulatory Authority Inc. records.
A call to Geoffrey McDonnell Meyer, who was assigned to represent Mr. Overbey as part of the Federal Defender Program, which provides an attorney to those who cannot afford one, was not returned.
Chris Reese, a spokesman for Ameriprise, said the firm terminated Mr. Overbey in 2006 and that the firm repaid clients. He also said any restitution Mr. Overbey pays would reimburse Ameriprise. The firm was not named in the U.S. attorney's case.
Mr. Overbey will begin serving his sentence in January. Following his sentence, he will be placed on supervised release for three years, during which time he will be prohibited from gambling or visiting casinos or racetracks.