A Washington State financial advisor has been sentenced to five years in prison and ordered to repay more than $1 million that he stole from eight elderly clients, the U.S. Attorney for the Western District of Washington announced Friday.
Edward H. Kahler, 65, the owner of Key Resources in Kenmore, Wash., a retirement consulting company that sold annuities and life insurance, was sentenced for mail fraud and Social Security number fraud, U.S. Attorney Jenny A. Durkin said.
At sentencing, U.S. District Judge Robert S. Lasnik called Kahler a “sophisticated fraudster” and noted, “He took away trust, he took away money… and now people’s lives are affected in a terrible way.”
Before opening Key Resources, Kahler worked for Variable Annuity Life Insurance Company (VALIC) selling annuities from 1983 to 2007. VALIC fired him in 2007 when it found he was promoting competing annuities. Kahler used proprietary information from VALICe to access customer accounts. He liquidated the accounts and used the money for a Las Vegas trip, a luxury car and other personal and business expenses.
In some cases he pretended to buy annuities for the clients but kept the money for himself, the complaint says. He sent false statements to the clients so they thought their accounts were growing.