Didn’t see this one coming: Investment ‘psychic’ charged with fraud

A man calling himself “America’s Prophet” and claiming the psychic ability to predict the stock market’s highs and lows was accused by federal regulators Thursday of bilking $6 million from more than 100 investors.

The Securities and Exchange Commission filed a civil lawsuit against Sean David Morton and three companies he is said to own under the name Delphi Associates Investment Group. The SEC says Morton lied to investors about his financial successes and the use of the investors’ money.

The SEC is seeking an injunction against Mr. Morton, and unspecified fines and restitution. Mr. Morton couldn’t be located Thursday for comment, and there were no phone numbers publicly listed in the area where he is said to reside. The SEC said it wasn’t aware of an attorney representing him.

Starting in 2006, Mr. Morton drummed up investors by telling them he would use his psychic powers to guide his investing team, according to the SEC. “I have called ALL the highs and lows of the market, giving EXACT DATES for rises and crashes over the last 14 years,” he proclaimed in a July 2006 newsletter.

Mr. Morton’s Web site, monthly newsletter, appearances on a national radio show and at public events were used to promote his psychic talents, the SEC said. Photos of him posing with celebrities including Mel Brooks, Robin Williams and the late Farah Fawcett are featured in his newsletter, along with his schedule of tours around the country and the motto: “All is One. Life has Purpose. God is Love.”

Mr. Morton, 51, a resident of Hermosa Beach, Calif., told investors that he would pool their money for trading in foreign currencies, but invested only about half the money that way, the SEC alleged. It said at least $240,000 of the investors’ money was diverted to Morton’s religious organization, Prophecy Research Institute.

“Morton’s self-proclaimed psychic powers were nothing more than a scam to attract investors and steal their money,” George Canellos, director of the SEC’s regional office in New York, said in a statement.

The SEC suit also names the Prophecy Research Institute and Morton’s wife, Melissa Morton, as so-called relief defendants — not accused of any wrongdoing but alleged to have received illegal profits from the scheme. The agency is seeking unspecified restitution from them.