According to reports, a former FBI agent and certified financial planner, and his wife, have pleaded guilty to bilking 11 investors in Virginia out of $1.3 million.
Specifically the reports state that John Robert Graves, 53, of Fredericksburg, Va., resigned from the FBI in 1999 and founded Brooke Point Management in 2003, through which he sold insurance and offered financial advice and investments.
Authorities said Graves and his wife, Sara Turberville Graves, 45, who served as secretary of Brooke Point and managing member of an Indiana real estate firm, defrauded 11 investors in central Virginia by selling investments through misrepresentation and omissions, including false statements to the SEC. They then used the investor funds to pay back previous investors, buy real estate and buy Compass Financial Advisers.
According to the U.S. Attorney, the Graves targeted elderly investors in central Virginia and absconded with more than $1 million.
John Graves received an 11-year, three-month prison sentence; Sara Graves received a three-year sentence. The couple previously forfeited more than $1.3 million and now owes more than $1.2 million in restitution.
Although restitution was part of the sentencing, it is unlikely that the victims will receive their losses back from these individuals. As such, The White Law Group is investigating other avenues of recovery.
Specifically, the firm is investigating the liability that the employers of Mr. Graves may have for failure to properly supervise his activities. Although Mr. Graves operated his own investment advisory firm he was also registered with several FINRA registered broker-dealers and operated his advisory firm under these firms’ umbrella.
When a FINRA affiliated broker conducts business outside of the firm with whom he is registered the activity may be considered “selling away.” If a registered broker “sells away” from his firm, the brokerage firm may still be liable for negligent supervision of their broker representative and may be responsible for investment losses in a FINRA dispute resolution claim.
According to Mr. Graves’ FINRA Broker Report, Mr. Graves was registered with FINRA registered members during much of the relevant time period, including having worked at Questar Capital Corporation from March 2005 through May 2008, Fintegra, LLC from May 2008 through August 2009, Community Bankers Securities, LLC from August 2009 through December 2009, and Harrison Douglas, Inc. from February 2010 through June 2010.
To the extent that Mr. Graves solicited investments in his scheme while affiliated with a FINRA registered broker dealer at the time of the solicitation, that brokerage firm may be liable for the losses incurred.
If you are a victim of Mr. Graves’ Ponzi scheme, please call the securities attorneys of The White Law Group at 312-238-9650 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit the firm’s website at http://www.whitesecuritieslaw.com.