SEC Task Force to Host Roundtable On Elder Fraud (Coffee and Danish Will Be Served, Maybe)

July 23, 2019

Elder fraud is all the rage these days. Nary a day goes by when we don't read about some horrific fraud being worked against senior citizens. Thankfully, federal and state prosecutors/regulators have been stepping up their efforts to pursue the predators who victimize senior citizens. Unfortunately, the old habits of bureaucracies die hard. Instead of spending every precious penny and second on investigation and prosecution, we see dollars and time diverted into public relations ploys. We got a task force hosting a roundtable! Why this penchant for silliness? Well, it does generate publicity and burnishes the resumes of so many consultants and brown-nosers. 

The Elderly Individiual . . . Individiual?

Elder fraud has many faces. In a recent criminal case, for example, Christopher J. Sakelarakis pled guilty in the United States District Court for the District of Connecticut to one count of wire fraud, and was sentenced to 30 month of prison plus three years of supervised release, and he was ordered to pay full restitution with interest. Milford Man Sentenced to 30 Months in Federal Prison for Defrauding Elderly Individiual [sic] (DOJ Release) As set forth in part in the DOJ Release:

[S]akelarakis held himself out as having the necessary qualifications, experience and abilities to provide investment services to an elderly victim-investor.  Sakelarakis falsely represented to the victim that he had a number of investment clients, that he was making a substantial profit including by day trading, and that he had a contact in an investment firm who provided him with stock tips.  Sakelarakis also represented that he would invest in stocks, options and other financial instruments on behalf of the victim and that his compensation would be a commission on 10 percent of the profits.

In October 2017, the victim provided Sakelarakis with a $60,000 check.  The funds were more than half of what the victim had saved for retirement.  Within days after receiving and depositing the check, Sakelarakis withdrew $30,000 in cash, and then made additional cash withdrawals, including several large withdrawals at ATMs.  Sakelarakis spent a portion of the funds at stores such as Armani Exchange, Foot Locker, Macy's and Gamestop.  In October and November 2017, Sakelarakis made several false representations in e-mails to the victim-investor relating to the status of the "investments" and the victim's account.  No funds were ever returned to the victim.

Microcap Pump and Dump

In "SEC Obtains Asset Freeze in Microcap Pump and Dump Scheme Targeting Elderly Retail Investors" (SEC Release), we learn that the SEC filed a Complaint in the United States District Court for the Eastern District of New York, charging Garrett M. O'Rourke and Michael J. Black with violating the antifraud and registration provisions of the federal securities laws. The Court issued an emergency order freezing the Defendants' assets. As set forth in part in the SEC Release, the Defendants had

worked together between 2016 and 2018 to fraudulently sell the stock of several microcap companies to investors, including elderly retail investors, using high pressure stock promotional campaigns. The SEC alleges that, as part of the scheme, O'Rourke aggressively touted the companies to prospective investors through unsolicited cold calls during which he repeatedly lied about his association with legitimate financial institutions and the prospects of the microcap companies. According to the complaint, O'Rourke also told prospective investors that he had their best interests in mind and that he had found promising investment opportunities for them. In actuality, however, O'Rourke was calling them to convince them to buy the stocks so that he and Black could sell their holdings in the same stocks for a profit. O'Rourke and Black also allegedly schemed to disguise their control over at least one of the microcap companies, EnviroTechnologies International, Inc., in order to facilitate their illegal sales of the company's stock in the public securities market, generating millions of dollars in proceeds.

SEC Task Force to Host Elder Fraud Roundtable

According to DOJ's and the SEC's press releases, federal prosecutors and regulators are rolling up the fraudsters and making great headway in the war against elder fraud -- which is as it should be. We need more cops on the Wall Street beat. Unfortunately, in this summer's installment of regulatory bull-shit, we have the SEC rolling out a Task Force, which will host a Roundtable. SEC Retail Strategy Task Force to Host Roundtable on Combating Elder Investor Fraud (SEC Release) A Task Force hosting a Roundtable. It's hard not to laugh at such idiocy. It's hard not to conclude that this is all about giving the appearance of effort rather than striving for accomplishment. As set forth in all it's stupidity in the SEC Release:

The Securities and Exchange Commission today announced that its Retail Strategy Task Force will host a roundtable on October 3 on combating elder investor fraud. The roundtable will focus on the types of fraudulent and manipulative schemes currently targeting elder investors. The roundtable also will explore views from a broad range of regulators and industry experts on potential steps regulators, broker-dealers, investment advisers, and others can take to identify and combat elder investor fraud.

The roundtable will be held at the SEC's headquarters at 100 F Street, N.E., Washington, D.C. and will begin at 9:30 a.m. ET. The roundtable will be open to the public and webcast live on the SEC's website. Information on the agenda and participants will be issued shortly.

Members of the public who wish to provide their views on the topic may submit comments electronically or on paper. Please submit comments using one method only. Information that is submitted will become part of the public record of the roundtable and posted on the SEC's website. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make publicly available.

Electronic Comments:

Use the SEC's Internet submission form or send an email to

Paper Comments:

Send paper comments to Vanessa Countryman, Secretary, Securities and Exchange Commission, 100 F Street, N.E., Washington, D.C. 20549-1090.

All submissions should refer to File Number 4-749 and the file number should be included on the subject line if email is used.

Why actually do something about elder investor fraud when you can serve danish, bagels, and coffee at a roundtable? I'm guessing that many veteran SEC examiners, investigators, and lawyers have suggestions as to how the federal regulator could effectively combat elder fraud, but, let's not get carried away here -- those folks aren't political appointees, and, as such, who the hell cares what they have to say. Moreover, let's not forget all the studies, white papers, and panels that have yielded all sorts of disregarded advice over the years. 

Which brings us to 2019, when the SEC thinks that the best use of its funds and time is to haul out a Task Force, which will host a Roundtable. This roundtable's ambitious goal is to "explore views" about how to "identify and combat elder investor fraud." 

Are you shittin' me? 

For starters, the best way to combat elder investor fraud would be to cut the waste of time and expense inherent in having a task force host a roundtable. 

The 2009 SEC Roundtable: A Walk Down Memory Lane

Alas, we are chained to a merry-go-round. It never stops going in circles. Democrats. Republicans. Progressives. Conservatives. It doesn't matter. It is the stuff of bureaucracy and big government. As I lamented a decade ago in "At The Head Of The Roundtable" (October 2, 2009)

Seems all those good folks in Washington, D.C., have a penchant for panels with lots of speakers. Not that any of this jawing ever fixed a single important problem, but it is a wonderful photo opportunity and you do get to bring a lot of folks together for a nice chicken lunch and a chance to catch up on all sorts of gossip. On the other hand, where Congress simply wastes times with overblown hearings, the SEC has taken this nonsense to amazing new heights. No more mere hearings -- we now have Roundtables. Not only does it sound more impressive but it conjures up the romantic vision of Camelot and King Arthur.

However, as memory serves me, Sir Lancelot, the greatest knight in the world, committed adultery with Queen Guinevere. That caused a nasty war between King Arthur and Lancelot, forced the other knights to pick sides, and that all pretty much destroyed the Roundtable. Camelot was never the same, except for a nice run on Broadway and a popular movie.

Just goes to show you that it isn't exactly a great idea to put a bunch of armored, sword-bearing, competitive guys facing each other around a Roundtable. Maybe that's why you don't see too many corporate boardrooms with Roundtables. There's a reason for all those rectangular tables. Someone needs to sit at the head of the table. Someone needs to be in charge.

Once upon a time, kings made decisions at the risk of losing their heads and kingdoms. In olden days, rulers didn't take polls, they didn't waste time with self-serving panels--those in power wielded power. My, what a novel concept! You're hired to do a job and you do your own homework, make your own decisions, and put your reputation on the line. You take personal responsibility for your actions.

We have become a nation that ponders everything without resolution. No one is in charge of anything. Our lives are run by committee -- or Roundtable. It is a nightmare of debates and discussions that go on endlessly.

TD Ameritrade launches an in-car feature that lets drivers check stocks, get prices while in traffic (

SEC Task Force to Host Roundtable On Elder Fraud (Coffee and Danish Will Be Served, Maybe) ( Blog)

Disbarred Lawyer Pleads Guilty to Wire Fraud and Aggravated Identity Theft for Scheme to Steal from Friend and Family / Used Identities of Friend and Family Members to Obtain Credit Cards and Access to Bank Accounts (DOJ Release)

Ameriprise Sought Permanent Injunction Forcing Future Employers to Disgorge Bonuses as RepaymentIn the Matter of the Arbitration Between Ameriprise Financial Services, Inc., Claimant, v. Jeffrey E. Krupnick, Respondent (FINRA Arbitration Decision) 

FINRA Arbitrators Bar Respondent From Presenting Defense and Facts at Hearing. In the Matter of the Arbitration Between Nicholas Ahuja, Ajay Ahuja,  Dr. Ajay Ahuja Deutsche Bank IRA, Claimants, v. Deutsche Bank Securities, Inc., Sterne, Agee & Leach, Inc., Stifel, Nicolaus & Co., Inc., and David Wilson Fleming, Respondents (FINRA Arbitration Decision)

FINRA Arbitrators Find Customer Did Not Intend to Complain. In the Matter of the Arbitration Between Michael R. Kanner, Claimant, v. Edward D. Jones & Co., Respondent  (FINRA Arbitration Decision)