Broker Charged With Stealing More Than $400K From Senior Clients: Prosecutor

MACOMB COUNTY, MI — A Macomb County investment broker has been charged with swindling clients out of more than $400,000. Ernest Julius Romer III was charged with two counts of embezzlement of $100,000 or more by Macomb County Prosecutor Eric Smith.

He alleges that Romer took more than $220,000 from two elderly clients and used it for shopping trips to stores like Costco, Target and Wal-Mart, restaurant bills and other personal financial transactions, the Detroit News reported. If convicted on both counts, Romer could face up to 40 years in prison.

“These senior citizens placed their trust in this financial broker, and he robbed them blind,” Smith said in a statement Monday. “We’ll do everything in our power to seek justice and secure whatever money is left for these victims.”

Last month, the state of Michigan’s Department of Licensing and Regulatory Affairs Corporations, Securities and Commercial Licensing Bureau issued a cease and desist order against Romer. According to a state filing, the agency investigated Romer and made several “findings of fact” that included:

• The investigation developed evidence that Respondent (Romer) convinced several Corecap customers to liquidate securities held in their Corecap accounts to make alternative investments with Respondent. However, Rather than invest the funds for the customers' benefit, Respondent deposited the cash generated by the securities liquidations into an account that he controlled, and used the money for non-investment purposes that only benefitted him.
• Respondent took $190,000.00 from Customer MR1 between July of 2014 and April of 2016 for what Customer MR believed to be investment purposes. This included a $110,000.00 withdrawal from Customer MR's Corecap account after Respondent liquidated $104,268.96 of stock in the account. Rather than deposit the funds into a brokerage account to buy investments for Customer MR' s benefit, Respondent deposited the funds into an account which he controlled and utilized the funds for his own benefit.
• Respondent took $115,000.00 from Customer GP2 on or around January 5, 2015 after Respondent convinced Customer GP to liquidate $157,052.78 of stock from his Corecap brokerage account. Customer GP believed that Respondent was going to invest the funds for Customer GP's benefit. Rather than invest the money for Customer GP's benefit, Respondent deposited the funds into an account which he controlled and utilized the funds for his own benefit.
• Respondent took $46,000.00 from Customer RK3 on or around April 30, 2015 after Respondent convinced Customer RK to liquidate stock in an IRA to fund the purchase of an annuity. Rather than purchase the annuity as promised, Respondent deposited the funds into an account which he controlled and utilized the funds for his own benefit.

The cease and desist order was signed Aug. 8 by LARA Director Julia Dale. Smith told the Detroit Free Press that Romer’s allegedly fraudulent activities may involve as many as 20 additional victims.

“I urge every saver out there to stay on top of his or her accounts. It never hurts to have another set of eyes on your life savings," Smith said in the statement. Scammers are set to prey on the inattentive investor.”

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