Ongoing Monitoring of Investment Portfolio is Crucial to Avoiding Scams

I have been asked if investors who hold accounts with large broker-dealers containing public securities need to be concerned about becoming a victim of an investment scam.  The answer is unequivocally, “yes.”  It is important at the onset of the relationship to conduct a thorough broker check in order to know the person with whom you are entrusting your savings. It may be even more important to monitor the investment account because things change, broker’s suffer personal problems, and sometimes the sheep who charms you into establishing the account with a blue chip stock sheds the sheep clothing and reveals the wolf only after months of building a trusting relationship with you.

All investors are responsible for monitoring the activity in their investment accounts.  Failing to monitor the account is akin to falling asleep at the wheel of the car — it won’t feel good when you finally wake up.

Below is a reprint of an article that emphasizes my point.  Hiring an attorney after you realize that money is gone and blaming the broker-dealer for failing to notice account irregularities may result in the return of some money, but it is far better to prevent losses before they occur as a result of an unscrupulous stock broker, investment adviser, or any other investment promoter.

In the past, investors simply have not had an easy, efficient and affordable way to evaluate investment portfolios or prospective investment opportunities.  That is no longer the case.  Today, investors have a choice.  They can sign-up for the Investment Scam Prevention Program^TM offered by Wittenberg Law.  The Investment Scam Prevention Program^TM is designed to identify red flags in any investment portfolio or prospective investment opportunity, and also to monitor investments on a monthly basis for account irregularities.  Before investing even $10,000, spend roughly $400 to have an independent, conflict-free, sophisticated attorney review the investment from a legal perspective.  Most scams are easily identifiable to the trained eye.

Contact Jeffrey Wittenberg, Esq., founder of Wittenberg Law, to inquire into the Investment Scam Prevention Program^TM.

Wachovia Broker Engaged In $40 Million Investment Scam The Toledo Blade, February 20, 2007 (Mark Reiter)

A complaint filed with brokerage regulators claims that William Sirls bilked millions of dollars from Wachovia Securities’ clients in fraudulent stock and real estate transactions to feed a gambling addiction.

Mr. Sirls, 42, who is facing charges in U.S. District Court in Toledo for money laundering and mail fraud, was a branch manager and vice president of a Wachovia Securities office in Toledo until March, 2005.

Federal prosecutors said the scamming of clients and co-workers at Wachovia and others involved $17 million to $40 million and began in 2000 and continued until last September, nearly two years after Mr. Sirls resigned from the brokerage.

The complaint, filed on behalf of two investors who lost more than $2.5 million, alleges that the Grosse Ile, Mich., resident took funds from Wachovia clients and others in short- term trading and high-risk stock options to pay gambling debts.

The complaint, which was provided by the investors’ attorney, Andrew Stoltmann, was filed with the National Association of Securities Dealers, the self-regulatory body of U.S. brokerage firms.

Mr. Sirls, a licensed securities dealer since 1990, allegedly lured investors into fictional and fraudulent schemes that promised big returns on stock trades and real estate. The complaint said investor Ken Walker, 83, of Grosse Ile and Marco Island, Fla., lost $2.4 million of nearly $4.9 million in what he thought was being invested in real estate transactions in California.

But Mr. Sirls used the money in “what amounted to a giant, multimillion dollar ponzi scheme,” the complaint said.

Mr. Sirls’ Toledo attorney, Stephen Hartman, said that his client is a compulsive gambler. “Bill does have a gambling problem, which, frankly, can be just as serious as a drug or alcohol problem,” Mr. Hartman said.

In the complaint, Mr. Stoltmann, a Chicago securities attorney, alleges that irregularities in client accounts should have alerted Wachovia to the fraud, and that two Wachovia employees – Mark Schneider and Randy Hunt – profited in the real estate scheme. Mr. Schneider is a senior vice president and Mr. Hunt is vice president of Wachovia’s downtown Toledo office. Mr. Hunt took over the now-closed West Toledo branch after Mr. Sirls resigned.

“Wachovia did not protect their clients,” Mr. Stoltmann said. “Both my clients maintained accounts with Wachovia through the present. Even after Mr. Sirls resigned, he continued this scheme with my clients.”A high school classmate of Mr. Sirls, Dennis Pousak, also is represented by Mr. Stoltmann in the complaint. Mr. Pousak, a Northville, Mich., attorney, said he began investing with Mr. Sirls in November, 2005, in part, because of a friendship that began more than 25 years at Gabriel Richard High School, Riverview, Mich.

“Bill is a very gregarious guy. He is very smart. Bill was good at whatever he tried – from dunking the basketball to being a scratch player at golf. Anything Bill tried, athletically and academically, he excelled and exceeded with very apparent ease,” Mr. Pousak said.

The complaint alleges that Wachovia officials began investigating the volume of trading in Mr. Sirls’ personal accounts and issues in his personal life in the months before he left the company. Mr. Hunt said yesterday that he couldn’t comment on the allegations raised in the investor complaint.

However, he said that an internal investigation into Mr. Sirls has begun. “Beyond that, I cannot comment on the investigation,” he said.

Mr. Schneider couldn’t be reached for comment.

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