Unlicensed Advisor Gets Over 6 Years for Ponzi Scheme
What You Need to Know
An unregistered advisor was sentenced to 75 months in prison for mail fraud in connection with a scheme in which investors lost more than $4 million.
The investors included his own family members and friends.
Victims lost their retirement money and, in at least one case, had no funds to care for disabled children.
An unlicensed investment advisor was sentenced on Friday in U.S. District Court in Tacoma, Washington, to 75 months in prison for mail fraud in connection with a scheme that defrauded investors out of over $4 million, according to Nick Brown, U.S. attorney for the Western District of Washington, and court documents.
Charles Richard Burgess, 67, of Vancouver, initially attempted to blame the COVID-19 pandemic for the loss of victim funds. Some of the victims were his own family members and friends.
In reality, Burgess had lost most of the investors’ money many years earlier and had concealed the losses from them, the Justice Department had alleged in its original information, filed Aug. 4, 2022, in U.S. District Court for the Western District of Washington at Tacoma.
In all, 32 investors lost about $4.3 million in principal payments they had made to Burgess. In addition to his prison sentence, Burgess was ordered to pay $4.4 million to his victims.
At the sentencing hearing on Friday, Chief U.S. District Judge David Estudillo pointed to the “long-lasting effects of the crime on the victims,” Brown said in a news release. Estudillo told Burgess, “To lie, to cheat, to steal seem to be the values you were living by.”
From the mid-1990s until 2021, Burgess led his victims, mostly friends and family, to believe he was successfully investing their funds for retirement. He sent fake statements showing significant gains. In truth, since at least 2013, the investment fund was insolvent and losing value, and Burgess took over $1 million in fees for his own benefit, according to Brown.
“It is heartbreaking to read the victim statements describing how their lives have been dramatically altered — no retirement, no funds to care for disabled children, in one instance a victim’s home placed at risk of foreclosure,” Brown said in a statement.
According to records filed in the case, in the mid-1990s, Burgess started selling investments in an unregistered investment vehicle that Burgess called “the pool.”
