Edward Matthes, Ex-Stockbroker Accused of Elder Investor Fraud
The US Securities and Exchange Commission (SEC) is accusing former broker, Edward Matthes of defrauding older investors of $2.4M. Matthes was a registered stockbroker and an investment advisor. The Financial Industry Regulatory Authority (FINRA) and the Wisconsin Department of Financial Institutions Securities Division have both permanently barred him.
The Federal Bureau of Investigation (FBI) opened a probe into his alleged actions last year. Matthes was a registered Mutual of Omaha broker from 2012 – 2019 which was when the firm fired him. He worked in the industry for 20 years.
Shepherd Smith Edwards and Kantas (SSEK Law Firm) is speaking to former customers of Edward Matthes, who has been the subject of over 14 customer disputes. If you suspect that your investment losses while Matthes was your broker may be due to fraud or negligence, contact our stockbroker fraud attorneys today.
Mutual Of Omaha Broker Allegedly Defrauded 26 Investors
According to the SEC, the former Mutual of Omaha broker based in Wisconsin defrauded 26 investors. Most of which were older investment advisory and brokerage customers that did not have a lot of investment experience. Many of his victims worked with him for several years and trusted him.
Matthes allegedly persuaded them to put their money, which came from their retirement funds, personal savings or investment portfolios into what they thought was a safe investment guaranteed to make them a 4% minimum annual yield.
In truth, the SEC contends that the investment never existed and the broker actually stole $1.4M of clients’ monies for his own use including credit card bills, his mortgage, car payments, home renovations, child support and other expensive items.
The ex-broker is also accused of stealing another $1M which he allegedly used to make unauthorized sales and take money out of customers’ variable annuities (VAs). Meanwhile, Matthes purportedly sought to hide his fraud by issuing $170K in Ponzi-like payments and sending out bogus account statements.
Now, the SEC wants the ex-Mutual of Omaha stockbroker and financial advisor to pay disgorgement of ill-gotten gains, prejudgement interest, and penalties.
21 Disclosures & Over A Dozen Customer Disputes
Previous to working for Mutual of Omaha, Matthes had been a broker with Thrivent Investment Management, MML Investors’ Services and AAL Capital Management. According to his BrokerCheck record, he has 21 disclosures and over a dozen customer disputes.
Also noted are his termination of employment by Mutual Fund of Omaha, his barring by FINRA and the state of Wisconsin, SEC charges and the FBI inquiry against him.
Broker Fraud Allegations From Former Customers Include:
Below are a number of the existing allegations of stockbroker fraud and negligence which has been filed against the former broker by customers who experienced investment losses. Of the customer disputes all were either settled or remain pending except for one that was dismissed.
- Misrepresentations
- Misappropriation
- Fraud
- Diverting customer funds
- Generating fake account statements
- Omissions
Why Older Investors Are More Vulnerable To Investment Losses
Many older investors cannot take on as much risk as younger investors. Huge investment losses later in life, especially those involving their retirement funds and savings can lead to devastating consequences. These consequences can include the inability to support themselves, pay for medical expenses and other needs.
Brokers and their brokerage firms know this yet, unfortunately, senior investor fraud continues to be a serious problem.
Brokers that defraud older investors – any investors really – should be held liable for their actions, as should the brokerage firms that failed to identify and stop the fraud while neglecting to properly supervise their registered representatives.
Our Broker Fraud Attorneys Can Help
If former Mutual of Omaha broker Edward Matthes handled your investments while he was at the firm or at any of the previous broker-dealers where he worked, contact SSEK Law Firm today. We can help determine whether you have grounds for an investor fraud claim and guide you through your legal options.