A former Milwaukee broker has been sentenced to 30 months in prison for orchestrating a $380,000 fraud that targeted six elderly investors.
Chris Kubiak, 60, was sentenced in U.S. District Court in Milwaukee on Thursday after pleading guilty to one count of wire fraud in May, according to the U.S. Attorney's Office of the Eastern District of Wisconsion.
Kubiak was also ordered to pay $379,977 to the six victims named in the indictment and to serve three years of supervised release after finishing his prison sentence, prosecutors said.
“The victims in this case entrusted Kubiak with savings they had earned through honest, hard work over their lifetimes,” U.S. Attorney Krueger said in a prepared statement. “Kubiak exploited that trust and now faces years in federal prison. Let this case be a warning to anyone who would prey on elderly members of our community.”
The indictment against Kubiak was tied to his work as a registered rep with Freedom Investors Corp., a Brookfield, Wis.-based broker that is no longer in business, and Calton & Associates Inc., a broker-dealer in Brookfield where Kubiak worked from 2017 to 2018, according to authorities and BrokerCheck records.
Kubiak's scheme involved withdrawing funds from the accounts of several elderly clients, sending them the money by check and then falsely telling them the funds were bonuses or dividends that he should reinvest for them, the U.S. Attorney's Office said. Kubiak then received checks from the investors, promising he'd use the money for investments, prosecutors said. But instead, "Kubiak deposited the funds into his own checking account and used the money for gambling and other personal expenses," the U.S. Attorney's Office said in a press release. "The scheme spanned a period of five years and was ultimately discovered by a victim’s relative, who reported Kubiak to authorities."
Kubiak has been barred by both the U.S. Securities and Exchange Commission and Finra in connection with the fraud.
Relatives of Kubiak's victims spoke at his sentence hearing, prosecutors said.
"Speaking for one of the victims, a relative described the debilitating emotional and mental distress suffered by her loved one who had long known and trusted Kubiak to grow her small nest egg," the U.S. Attorney's Office said in a press release. "In sentencing Kubiak, the court emphasized the need for punishment and deterrence, both for Kubiak and for others who might be similarly tempted to prey upon the elderly."
Kubiak was arrested in March as part of a nationwide sweep by the U.S. Justice Department against scam artists who target the elderly.