The U.S. Securities and Exchange Commission is filing fraud charges against Louis Martin Blazer III, a Pittsburgh-based financial adviser. Blazer founded Blazer Capital Management—a firm that works with high-net worth individual clients and professional athletes. He allegedly took money out of the accounts of these athletes without their permission so he could issue Ponzi-like payments and invest in movies.
The SEC contends that Blazer took about $2.35M from five clients and invested in two movie projects. One client had even rejected the opportunity to invest in the films and still Blazer purportedly took $550K from this person’s account and invested the funds. After the client found out about the authorized investment and demanded his money back, Blazer allegedly used from another athlete’s account to pay the other client back, forging the second client’s signature on documents to initiate the transfer of $650K. He used $550K of that to pay back the first client. He purportedly used the remaining $100K to invest in a music venture on behalf of Blazer Capital.
When SEC examiners discovered the unauthorized transactions made in clients’ accounts, Blazer allegedly lied about them and turned over false documents that he had created to conceal his misconduct. He said that clients had authorized the transactions.
By settling, Blazer is not denying or admitting to the SEC charges. He is, however, charged with violating the Securities Act of 1933, the Securities Exchange Act of 1934, Rule 10b-5, and the Investment Advisers Act of 1940.
Professional athletes are targeted by financial scammers because of their high income and accumulated net worth. Unfortunately, many athletes don’t have a lot of investment experience or knowledge, which makes them vulnerable to financial investment scams. For many athletes, they are only able to make money in their profession until a certain age. Losing their earnings because of fraud may lead to devastating consequences for athletes and their families.
At The SSEK Partners Group, we represent high net worth individuals in recouping their securities fraud losses. Contact us today.
Read the SEC Complaint (PDF)