Metaphysical Wisdom A Bit Spotty
A former financial advisor who used astrology to forecast the financial markets should’ve used his powers to see the scheme would land him a 3-year prison sentence. A Florida judge on Monday sentenced Gurudeo "Buddy" Persaud to prison and ordered the former broker to pay restitution for swindling nearly $1 million from over a dozen clients.
Through his investment firm, White Elephant Trading Company, Persaud allegedly made trading decisions for clients based on lunar cycles and gravitational pull information he received from an online service. Persaud peddled the theory that when the moon exerts greater gravitational pull on the Earth, people feel dejected and are more inclined to sell securities, according to the SEC’s complaint.
But the SEC alleged it was more than just bad mojo, charging the former Florida advisor with civil fraud in January. According to the regulator, Persaud neglected to inform his clients of his unique trading philosophy, instead falsely guaranteeing their money would be safe and yield lofty returns ranging from 6 to 18 percent.
Persaud allegedly lost about $400,000 of investor funds through his trading, but also started to pad his own pockets as well, diverting at least $415,000 to pay for his personal expenses.
Using Your Parents As a Personal ATM
Most parents joke their kids are robbing them blind—but for one New Jersey couple, it was no joke. A former Lincoln Financial advisor pled guilty to systematically stealing over $1.35 million from his parents’ accounts.
Hugh R. Hunsinger Jr. faces up to five years in prison under last week’s plea deal, as well as being responsible for $1,354,496 in restitution. According to prosecutors, from January 2005 and July 2011, Hunsinger served as his parents’ financial advisor.
Without authorization, the New Jersey advisor allegedly transferred funds into his personal accounts, leaving only a nominal amount of money in their accounts.
The former advisor is set to be sentenced in an Oct. 4 hearing. As part of the plea agreement, Hunsinger will also lose his insurance producer license for up to five years, and a judgment in the amount of $1,354,496 also will be entered against him.
Stick To Oil Changes
A former Jiffy Lube employee is facing fraud charges from Massachusetts’s Secretary of State William Galvin. According to the Boston Business Journal, Daniel J. McLellan allegedly passed himself off as a financial advisor at a nonexistent firm while speaking to a woman having her car serviced at a local Jiffy Lube.
McLellan spoke so convincingly regarding the stock market, the woman gave him $50,000 to invest, according to the Galvin’s office.
But McLellan—who has never been registered with the SEC or FINRA—kept a large portion for himself. Six months later, the remaining funds were gone, primarily as a result of his trading them on margin.