Utah Retirement Plan Administrator Charged With Defrauding Investors
May 23, 2014
May 23, 2014 — It is a crime for investment advisory firms to defraud customers who trust them with their retirement savings. To fight illegal investment fraud, the U.S. Congress established a whistleblower program as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Tipsters who notify the Securities and Exchange Commission (SEC) when an employer is engaged in SEC and CFTC fraud
or misinformation may receive a reward for collaborating with the government, so long as the total recovery tops $1 million.
IRA Plan Administrator Allegedly Invested Client Savings In Friend’s Losing Business And Hid Losses With Phony Account Statements
A Utah retirement plan administrator has been charged by the SEC
with defrauding investors with self-directed individual retirement accounts (IRAs), resulting in their loss of $22 million in savings. Curtis L. DeYoung and his retirement investment company, American Pension Services Inc. (APS), allegedly wasted investors’ savings on risky investments and concealed the losses by sending out phony account statements, allowing him to continue collecting fees and further victimizing his customers.
Since at least 2005, DeYoung allegedly has been cheating customers with IRAs that contain non-traditional assets. DeYoung allegedly created forged letters with his clients’ phony signatures to authorize his clients’ investments in promissory notes issued by DeYoung’s friend, who ran an unsuccessful business that never made a profit. The friend defaulted on the notes in 2010 and DeYoung forgave the debt. But DeYoung kept investing his clients’ savings in the notes until at least April 2013. DeYoung hid the investments and the losses from his IRA customers.
When the SEC asked DeYoung about APS’s losses in his friend’s losing venture, as well as other unprofitable schemes, DeYoung declined to answer, based on his Fifth Amendment privilege against self-incrimination.
Whistleblowers Notify SEC When Investment Advisory Firms Mislead Clients
Investment advisory firm employees who uncover schemes to mislead investors should understand how the Dodd-Frank whistleblower program works before they notify the SEC. The SEC fraud lawyers at Waters & Kraus have the experience necessary to protect tipsters’ interests in investment fraud cases. Contact us by email
or call our qui tam lawyers at 855.784.0268 to discuss how we can assist you.