A former broker with 28 years of experience in the securities industry was arrested Sunday in Mercer County, Ohio, and was indicted on 96 criminal counts for allegedly defrauding Ohioans out of more than $1 million, according to a statement yesterday from the Ohio Department of Commerce.
The ex-broker, Christopher T. Wendel, until 2017 worked at SA Stone Wealth Management Inc., formerly Sterne Agee, in Celina, Ohio. The Financial Industry Regulatory Authority Inc. barred him from the securities industry in 2018 after Finra claimed Wendel, without telling his firm, sold $345,000 of a real estate Ponzi scheme, Woodbridge Group of Companies, and charged $10,000 in commissions.
This week's criminal indictment alleges that from 2019 through 2021, or after he had been barred from the securities industry by Finra, Wendel solicited 10 Ohio residents, some of whom are elderly, to invest over $1.2 million in his company, Buckeye Income Fund, through material misrepresentations and fraud.
As of Monday afternoon, Wendel, 58, was incarcerated in the Mercer County Jail awaiting his arraignment and bond hearing, according to the Ohio Department of Commerce. A spokesperson for the department on Tuesday morning said Wendel's arraignment was scheduled for tomorrow.
According to his Facebook page, Wendel is owner of a local bar, Boots'n Bourbon. Calls to the bar on Tuesday were not answered.
"First of all, the sales agent has to be registered to sell securities or give advice," said Joseph Borg, former director of the Alabama Securities Commission. "Guys of this sort sound like potential straight up frauds. Investors must check and see if the salesperson is registered. Go to the Finra BrokerCheck website for brokers or check with the states for investment advisors."
"If he doesn't have a license to be a broker or work as an investment advisory, my advice is simple: hang onto your wallet," Borg added.
“Before making any investment decisions, we strongly urge individuals to verify the credentials of the financial advisor with whom they’re working and investment opportunity being presented to them, and to report any instances of suspected fraud immediately to the Ohio Division of Securities," said Andrea Seidt, Ohio Securities Commissioner, in a statement.
Wendel was "discharged," meaning fired, by SA Stone Wealth Management in 2017 due to allegations that he "violated firm policy regarding selling away," according to his BrokerCheck report. The act of selling away by a financial advisor means the advisor offered clients investments that are not approved by the firm.
For close to five years up until the end of 2018, the Woodbridge Group of Companies operated a billion-dollar Ponzi scheme, taking advantage of 8,400 investors, many of them elderly.
On behalf of Woodbridge, hundreds of insurance agents and brokers, some with checkered careers in the securities industry, sold notes supposedly backed up by mortgages, which the Securities and Exchange Commission claimed were the foundation of a massive, $1.2 billion Ponzi.
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