An former dually registered Wisconsin advisor was sentenced to four and a half years in prison for stealing more than $1.8 million over 23 years from clients and evading taxes on the ill-gotten gains, according to the U.S. Attorney’s Office for the Western District of Wisconsin.

Thomas Demergian, 63, of Madison, was sentenced after pleading guilty to wire fraud and evading federal taxes in APril. He was also  ordered to pay restitution, the U.S. Attorney's Office said in a press release. 

Demergian first convinced some of his elderly clients to invest with him through “IRT Company” in 2020, saying he would put their money to work in real estate trusts and mutual funds, prosecutors said.

Instead, he diverted the investments to his own bank account to use for gambling, travel, cars, collectibles and personal expenses.

“Demergian met with clients annually and provided them with fictitious investment portfolio summary sheets reflecting positive growth,” the release stated. “When clients asked him to liquate their investments, Demergian told clients that such a decision was imprudent or provide other untrue reasons why their requests could not be completed.”

Demergian began his brokerage career at American Express Financial Advisors in Minneapolis from June 1993 to January 1996. He then went on to SunAmerica Securities in Phoenix from January 1996 to October 2005, and SagePoint Financial in Verona, Wis., from October 2005 until November 2009.

From November 2009 until October 2014, Demergian was registered as a broker at American Portfolio Financial Services, and as an investment advisor from July 2010 to October 2014 at Regal Investment Advisors, both also in Verona.

While Demergian never again registered as a broker, he was a registered investment advisor from July 2021 to February 2023 at Insight Wealth Management in Verona.

The scheme was discovered in 2023 when a client’s family member got involved and started asking questions about the investments.

From 2017 to 2022, Demergian underreported his income on his federal tax returns by $400,000 in illegally obtained income, evading more than $100,000 in taxes, prosecutors said.

U.S. District Court Judge William M. Conley said at sentencing that, “in terms of white-collar crime, this is the worst” because Demergian “cynically targeted elderly and vulnerable victims, many of whom he had also befriended.” While Demergian did end up helping investigators, the judge said, that was only after he allegedly had been “found out.”

Demergian was permanently barred in Wisconsin in March 2023 for allegedly violating the state’s securities law by persuading 14 investors over 20 years to transfer investment funds into a bank account he controlled and used for his own purposes, according to BrokerCheck.