An Illinois financial advisor has been charged with six counts of fraud for duping three clients into a supposed investment opportunity in tax-exempt, interest-bearing bonds or bond funds. In fact, no such opportunity existed, said the U.S. Attorney's Office in a criminal indictment.
The Department of Justice said Ronald T. Molo, 61, used the nearly $800,000 he raised from the clients for his personal use, including the purchase of at least two vehicles, the payment of credit card bills, payment of his home mortgage and the mortgage on his in-laws’ home, expenses for a home remodeling, lottery tickets, travel and shopping, and a payment to a member of his family. If convicted, each of the six counts is punishable by up to 20 years in federal prison.
Criminal charges were filed today against Molo by the U.S. Attorney's Office for the Northern District of Illinois, and the Securities and Exchange Commission filed a parallel complaint in U.S. District Court.
Molo could not be reached for comment by press time.
According to the indictment, Molo was a registered financial advisor working out of the Joliet branch office of a national financial services firm between 2018 and June of this year. Although the filing did not name the company, BrokerCheck lists Edward Jones as Molo’s employer during this time.
The agencies said Molo made false representations to at least three clients that their money would be invested in municipal bonds or bond mutual funds that had a periodic interest rate of about 5%. Molo characterized the bonds as being exempt from federal and state taxes and said they were were affiliated with “Ivory Stone Investment Partners,” “Spire Investment Partners,” or “Lord Abbett,” the filing said.
Molo then had his clients sign written authorizations using official Edward Jones forms to transfer funds from their accounts at the firm to an outside account, which was actually a personal bank account held by Molo and his wife, the DOJ said. He was terminated by Edward Jones on June 15 of this year, according to BrokerCheck.
“In soliciting his clients’ signatures, Molo used the authorization forms of his employer, thereby giving his clients a false sense of security and confidence that they were making authentic investments sanctioned by the firm,” the filing said.