Compliance

US Authority Charges Husband And Wife Involved In Charity Scam

Eliane Chavagnon Reporter 8 February 2013

US Authority Charges Husband And Wife Involved In Charity Scam

The Securities and Exchange Commission has charged a husband and wife who raised “millions of dollars” selling investments for a purported charitable organization in Tallahassee, FL, with defrauding senior citizens and “significantly exaggerating” the amount of contributions made.

We The People obtained $75 million from some 400 investors among over 30 states across the US by selling an investment product they described as a charitable gift annuity after Richard Olive and Susan Olive had joined the firm. The SEC alleges that the Olives received over $1.1 million in salary and commissions and “siphoned away” investor funds for their personal use.

The couple also “lured elderly investors” with limited investing experience by making a number of false representations about the value and financial benefits of the organization's CGAs. They also lied about the safety and security of the investments.

According to the SEC’s complaint - filed in US District Court for the Southern District of Florida - investors were coaxed to transfer assets including stocks, annuities, real estate and cash, in exchange for a CGA.

The organization claimed to operate as a non-profit whilst offering the CGAs from June 2008 to April 2012. Instead, it was operating for the primary purpose of issuing CGAs and using the proceeds to pay “substantial sums” to the Olives, third-party promoters and consultants, the SEC said. “On rare occasions when We The People did actually direct money raised toward charitable services, it was insignificant.”

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