AG: Former investment adviser stole $3 million as part of fraud scheme
Oct 28, 2017, 7:30 AM
(Photo: Arizona Attorney General's Office)
(Photo: Arizona Attorney General's Office)
PHOENIX — A former investment adviser and securities salesman pleaded guilty to stealing more than $3 million in client funds, the Arizona Attorney General’s Office announced Friday.
The office said Richard Mark Schmerman, 58, pleaded guilty to two counts of theft and two counts of fraudulent schemes and artifices as part of a plea deal he made with the attorney general in exchange for a reduced sentence, according to a press release.
An affidavit said the crimes happened between Jan. 2005 and Jan. 2013 where the man impersonated some of his clients to gain access to their investment accounts.
He also used client investment funds to pay personal expenses, which included a single payment of $400,000 to pay a civil judgment against him.
As part of the agreement, Schmerman faces a mandatory prison sentence of five years, according to Arizona law. He is required to serve probation for a period of up to seven years. He also must pay back the $ 3 million in restitution to his victims, the press release said.
The plea agreement said Schmerman made fraudulent arrangements without investor’s knowledge.
He will be sentenced in Arizona Superior Court on Jan. 10.
