Claus Foerster, Former Raymond James and Morgan Keegan Advisor, Indicted in Ponzi Scheme
Have you lost money investing with Claus Foerster of Greenville, South Carolina? According to wsoctv.com, Foerster was recently indicted for running a $3 million Ponzi scheme. Foerster was previously employed as a financial advisor with Raymond James and Morgan Keegan.
Claus Foerster was previously barred by FINRA, the Financial Industry Regulatory Authority. Foerster opened his own bank account under the name “S.G. Investments” and then solicited it to his customers at Raymond James and other firms as an “income-oriented” investment. He then instructed his securities customers to move funds from their brokerage accounts into their own personal bank accounts and then to write a check directly from their bank accounts made out to “S.G. Investments” for investment purposes. FINRA has alleged that “S.G. Investments” was not an investment fund but rather Foerster’s own personal bank account of which he had full control.
Not only was Foerster collecting personal checks from his clients at Raymond James & Associates and other firms, and depositing them into his own bank account which he named “S.G. Investments”, but he decided to create fictitious monthly account statements as well as, allegedly providing at least two of his victims with purported monthly dividend payments. FINRA alleges that Claus C. Foerster converted approximately $3 million dollars from 13 customers. Foerster signed a letter dated June 17, 2014 accepting punishment from FINRA without admitting or denying his actions.
FINRA alleges that Claus C. Foerster’s Ponzi scheme began in approximately 2000.
Broker-dealers like Morgan, Keegan & Company; and Raymond James & Associates, Inc. have a responsibility to adequately supervise all representatives who are registered through their firm, including investments sold by their registered representatives. Broker-dealers also must take steps to ensure that their financial advisors follow all securities rules and regulations, such as to ensure that investments are suitable for clients. The securities firm must perform adequate due diligence on an investment before recommending such to a client, so that the firm can adequately explain the risks and characteristics of the investment to an informed client. When broker-dealers fail to adequately supervise their registered representatives, make unsuitable investment recommendations, or fail to perform adequate due diligence on an investment, they may be liable for investment losses sustained by customers.
If you have been a victim of Claus C. Foerster’s Ponzi Scheme and want to hear about ALL legal options, please visit http://www.israels-law.com/ or call us at 720-599-3505.