SEC says suicide broker bilked big-time college coaches

SEC says suicide broker bilked big-time college coaches
Claims Salinas defrauded Lute Olsen, others out of $50M; killed self in July
NOV 02, 2010
By  John Goff
The U.S. Securities and Exchange Commission sued the estate of J. David Salinas, an investment manager who committed suicide last month, claiming his companies ran a Ponzi scheme, selling investors bonds that didn't exist. Salinas, through his companies Select Asset Management and J. David Group, defrauded investors of more than $50 million from 2004 to the present, the SEC said in a complaint filed yesterday in federal court in Houston. The agency also sued Brian A. Bjork, chief investment officer of Select Asset. “Bjork and Salinas promised investors safe, fixed-income by investing in highly rated corporate and other bonds with annual yields up to 9 percent,” the SEC said. “In reality, the J. David Group corporate bond offering was bogus.” The investors included numerous college basketball coaches including Lute Olson, former coach at the University of Arizona, and Scott Drew, coach at Baylor University. Salinas was a founder of an elite high school summer basketball program in Houston and a donor to college sports programs. The SEC asked the court to freeze assets of the estate, the companies and Bjork “to ensure the eventual return of the assets to their rightful claimants.” U.S. District Judge Keith P. Ellison granted that request and set a hearing for Aug. 10. Ellison also ordered the defendants and anyone working with them not to destroy records related to the transactions or assets. “Our enforcement action seeks to put an end to an alleged scam that took millions of dollars from more than 100 investors,” said Robert Khuzami, director of the SEC's enforcement division. “Brian has been supplying information and documents to the SEC but has not himself been interviewed,” Matt Hennessy, Bjork's attorney, said in a phone interview. “At this point, Brian plans to continue to cooperate with the investigation,” he said. Salinas, 60, was found dead of a gunshot wound on July 17 at his home in the Houston suburb of Friendswood, Texas. Kathleen Galloway, an SEC attorney, said in yesterday's filing that a Galveston County prosecutor told her July 17 that the death was “apparently a suicide.” --Bloomberg News--

Latest News

The advisor’s essential role as alternative investments go mainstream
The advisor’s essential role as alternative investments go mainstream

With doors being opened through new legislation and executive orders, guiding clients with their best interests in mind has never been more critical.

Advisor moves: Raymond James snags advisor teams from RBC, Wells Fargo, Thrivent
Advisor moves: Raymond James snags advisor teams from RBC, Wells Fargo, Thrivent

Meanwhile, Stephens lures a JPMorgan advisor in Louisiana, while Wells Fargo adds two wirehouse veterans from RBC.

Private equity’s courtship of retail investors irks pensions, endowments
Private equity’s courtship of retail investors irks pensions, endowments

Large institutions are airing concerns that everyday investors will cut into their fee-bargaining power and stakeholder status, among other worries.

J.P. Morgan Securities on the hook for $1.1M to advisor in back-pay dispute
J.P. Morgan Securities on the hook for $1.1M to advisor in back-pay dispute

Fights over compensation are a common area of hostility between wealth management firms and their employees, including financial advisors.

After Muni bond fund blow up, broker-dealers Osaic and Stifel Nicolaus face questions
After Muni bond fund blow up, broker-dealers Osaic and Stifel Nicolaus face questions

Plaintiff's lawyers are eying both broker-dealers for potential client complaints.

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.