SEC files charges against former Wausau broker, investment agent

Wausau, Wisconsin (WSAW) – The Wausau broker and investment agent, which was barred from the industry last year, faces indictments filed Tuesday by the U.S. Securities and Exchange Commission.

Tony Riddle and his company, Prosper Wealth Management, face three counts in which Riddle defrauded at least 13 clients. Many of the complaints detail what 7 Investigates previously reported in his December.

According to the complaint, from June 2019 to May 2022, Lidl misrepresented how client funds were used and the risks of their investments. Lidl lied to clients that their portfolio had become less secure. He offered to invest the funds in securities that he said were less risky. I never purchased any securities.

Instead, the complaint alleges that Lidl “supports a ruse” by misappropriating the client’s money and using a small portion of that money to give the client what he claims is interest from an investment. ” is written.

Lidl opened a bank account in the name of Prosper Wealth Management, but the account was hidden from his other employees. This account is where clients’ checks flow in and out and is used for Lidl’s personal and business expenses, including Lidl’s own salary.

“Liddle’s lies led many of its clients to believe they were receiving regular and reliable returns from their investment portfolios,” the complaint reads. “The cold truth was that the principal ran out month by month and the little interest they received was a lie to cover up Riddle’s theft.”

The SEC complaint details Liddle’s “plans.” Lidl says it misrepresented the risks associated with investments similar to L-bonds sold by brokerage firm GWG Holdings. Riddle told clients that bonds offer a safer, less risky investment than their existing portfolios. These statements prompted the client to sell existing investments and buy bonds. According to the complaint, some of the funds that the client provided to his PWM included funds that he previously did not control with PWM.

For clients in mid-2020, Lidl spoke to them about stock market volatility given the COVID-19 pandemic. In early March 2020, the SEC said that Lidl “knew or recklessly disclosed that GWG Holdings disclosed that his L-Bond investment “involves a high degree of risk, including the risk of loss.” I didn’t know,’ he said. [one’s] investment as a whole,” and that “investments ‘may be considered speculative.’”

The complaint further states: GWG has further disclosed on page two of its 2020 prospectus. “L-bonds are only suitable for those who have sufficient financial resources and do not require liquidity for this investment.” (original emphasis)

Lidl was also given GWG’s marketing materials that he provided to customers. This included GWG temporarily suspending the sale of his L-bonds from April to November. 2021 and in January 2022 he stopped selling L bonds. Despite these circumstances, “Liddle regularly sent oral, written and electronic statements to its clients advising them that L bonds were low risk.”

Lidl set up individual planning meetings to help customers buy L-bonds with peace of mind. One client wrote “Safe Money Acct” in the notes section of his May 2021 check sent to Lidl and her PWM to invest the funds.

In another example, the SEC explains:In December 2021, Lidl went to meet with a client at a nursing home and handwritten notes outlining an investment plan. In those discussions, he guarantees the safety of his L-bonds and writes that clients can rely on monthly interest payments from his L-bonds on the 1st of each month. Riddle said that from this client he received a check for investment in his Bond of $110,000, but he never invested the money. ”

Lidl continued to make false reports to clients about investments made by GWG or similar, including telling one client in January 2022 that her investments were safe and available for withdrawal.

“This client is satisfied with the interest payments from Lidl’s invested L bonds (purchased allegedly in July 2021 during the GWG 2021 suspension) and has He transferred more funds to Lidl to purchase additional L-bonds in January. also stolen,” the lawsuit states.

When one of his customers exposed Lidl’s conduct, the SEC said, “He drafted a promissory note between the victim and PWM, backdated the documents, and forged the customer’s signature to They tried to cover up the theft,” he said. He told the Wisconsin Department of Financial Institutions that a client provided him with a loan using these promissory notes as evidence.

Lidl has 21 days to respond to complaints.

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