The Securities and Exchange Commission has charged James Hocker, a Bellefonte, Penn., insurance agent, with engaging in a Ponzi scheme that targeted unsophisticated retail investors.
After selling insurance policies, according to the SEC's complaint, Mr. Hocker encouraged his clients to invest with him by promising guaranteed returns of between 10% and 30% from investments he would make on their behalf. Some investors allegedly withdrew money from their life insurance policy or retirement accounts to fund their investment with Mr. Hocker, who pocketed the money and used it for personal living expenses and to make payments to other investors.
The SEC said that over the last five years, Mr. Hocker raised approximately $1.27 million from about 25 investors, most of whom were elderly retirees or individuals nearing retirement. Most had little experience in investing and some were widows who relied on Mr. Hocker to manage their money following the death of their husbands.
The SEC is seeking an injunction, disgorgement and penalties.