Investment advisor takes advantage of clients who trusted him
MILWAUKEE (WITI) -- Who do you want to do business with -- someone who is shy and unsure, or a salesman with charisma? FOX6's Contact 6 says when it comes to your money, beware of an advisor with a silver tongue.
"The fraud involved a hedge fund that didn`t exist and an investment advisor who had tricked four investors," U.S. Postal Inspector Greg Ghiozzi said.
Robert Beauchene was that advisor.
"He had acted as investment advisor while he worked in New York. He moved down to Wilmington, NC but maintained relationship with them and asked them to invest in this hedge fund," Ghiozzi said.
Beauchene promised investors a 10-20% return on their money. They trusted him, so they made the leap.
"The previous relationship was an important aspect of him gaining their trust. He was also a very personable guy, very interesting guy and that also helped win over their trust," Ghiozzi said.
Investors received stock certificates, as well as monthly statements showing a healthy profit for the fund.
However, these were phony documents.
After several months, investors started to have questions.
"The investors realized they had been scammed when Robert Buchenne stopped returning their calls and seemingly fell off the face of the earth," Ghiozzi said.
The small group of investors lost more than $140,000 -- money authorities believe Beauchene used for himself.
Several victims were devastated.
"The money they invested was all they had in savings and the loss of that money had a dramatic effect on their lives," Ghiozzi said.
Postal inspectors say the victims had such a strong relationship with Beauchene, they weren't hesitant to believe he scammed them.
"Not only is there a financial loss, but there is also an emotional loss, and sometimes that emotional loss of trust is actually more damaging than the financial losses," Ghiozzi said.
A warning from Postal Inspectors -- Don't let emotions guide your investment decisions. Always do your research.
Beauchene was sentenced to one year in prison, plus three years of extended supervision.