Scheming Brothers, Hedge Fund Phoney, Accelerated Benefit Scammer
A former Morgan Stanley financial advisor was sentenced to two years in federal prison and three years of supervised release for defrauding a widowed client. The U.S. Attorney’s Office for the District of Oregon said that Gregory Walsh, a former Morgan Stanley Vice President, convinced the client to invest $1.1 million in California property. However, rather than make a legitimate investment, he conspired with his brother, Geoffrey Walsh, a bank executive, to put the client’s money into a business Geoffrey owned. At no point did Gregory provide his client with appropriate documentation. Geoffrey then sold off some of the property without the client’s permission in order to pay for personal expenses. The two conspired to do two similar deals that defrauded the client out of an additional $4 million. Geoffrey Walsh pleaded guilty on two counts and was sentenced to 30 months in federal prison and three years of supervised release.
A New York man has been charged with defrauding investors out of $5.3 million by claiming he was a successful hedge fund manager linked to the former Genovese drug store chain. According to prosecutors, Nicholas Genovese defrauded investors in his phony hedge fund for at least three years. According to securities regulators, he lied about managing $4 billion in assets for the Genovese family. He also falsely claimed he produced annual returns of between 30 percent to 40 percent, rather than disclose the fact that he actually lost money. During the fraud period, Genovese lost $8 million in client money. This did not stop him from spending $263,000 of their money on his lavish lifestyle, including being chauffeured around in a Bentley.
A Virginia life insurance agent has been convicted on charges of defrauding a client in the amount of $182,000. According to authorities, Semyya Cunningham, 40, sold a life insurance policy to a friend. The contract included an accelerated benefit rider which allowed the insured to file for benefits in the event of a terminal illness. Several months after purchasing the policy, the insured was, in fact, diagnosed with a terminal illness. However, instead of helping her friend collect the benefits for which she now qualified, the agent altered the contact information for the policy to her own name so she could apply for benefits herself. After receiving the money, she then transferred it to several different accounts in order to prevent the insurer from reversing the transaction. Cunningham faces maximum jail time of 20 years. She will be sentenced in May 2018.
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