Adviser in dutch for allegedly scamming Amish clients

The Securities and Exchange Commission has charged a 77 year-old Amish financial adviser with defrauding his fellow Amish in an investment scheme that allegedly went on for 24 years.
JAN 30, 2011
The Securities and Exchange Commission has charged a 77 year-old Amish financial adviser with defrauding his fellow Amish in an investment scheme that allegedly went on for 24 years. From 1986 through June 2010, Monroe L. Beachy, who until June ran Sugarcreek, Ohio-based A&M Investments, raised $33 million from more than 2,600 investors — most of whom were Amish, according to the SEC complaint. Mr. Beach allegedly told investors that their money would be used to purchase risk-free U.S. government securities. Instead, he made speculative investments and lied about it, according to the complaint, which was filed Feb. 15 in the U.S. District Court for the Northern District of Ohio. Mr. Beachy filed for bankruptcy in June 2010. Up until that point, the SEC claims, he lied about how he was investing his clients' money. The commission said, “Beachy also never told his investors that he had experienced significant losses on the underlying investments.” Rather, he “provided his investors with monthly account statements that showed fabricated gains,” the SEC said. By the time Mr. Beachy filed for bankruptcy in June 2010, less than $18 million of the original $33 million of investor money remained. Mr. Beachy, reached at his home, declined to comment. Because of the length of Mr. Beachy's alleged scheme, generations of families were affected because older generations of Amish investors referred their children to him. “Amish children did in fact purchase investment contracts from Beachy,” according to the complaint. Mr. Beachy has agreed to settle the SEC's charges without admitting or denying the allegations, according to an SEC notice about the complaint. The SEC is not imposing a civil penalty on him, based on his financial condition, according to the agency's notice.

Latest News

How firms can support advisors during difficult market times
How firms can support advisors during difficult market times

For service-focused financial advisors who might take their well-being for granted, regular check-ins and active listening from the top can provide a powerful recharge.

Savant Wealth targets Silicon Valley with Parkworth acquisition
Savant Wealth targets Silicon Valley with Parkworth acquisition

With Parkworth Wealth Management and its Silicon Valley tech industry client base now onboard, Savant accelerates its vision of housing 10 to 12 specialty practices under its national RIA.

RIA moves: PE-backed Arax strengthens Midwestern presence with Summit Wealth Strategies
RIA moves: PE-backed Arax strengthens Midwestern presence with Summit Wealth Strategies

Meanwhile, $34 billion independent First Manhattan welcomed New Jersey-based Roanoke Asset Management, an RIA firm with more than 40 years of history.

Osaic sees more staff cuts
Osaic sees more staff cuts

Most notably, two chief compliance officers have also recently left the firm.

Advisor moves: Cetera lures 12-person team from LPL, Raymond James reels in Commonwealth duo
Advisor moves: Cetera lures 12-person team from LPL, Raymond James reels in Commonwealth duo

The latest team to join Cetera, led by a 29-year veteran professional, arrives with roughly $380 million in AUA from OSJ Private Advisor Group.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.