Three investors filed a $5 million financial fraud lawsuit against two custodians of self-directed IRAs claiming the companies knew their money had been stolen yet sent them reports showing them their money was still in their accounts.
The complaint was filed in California state court and accuses Equity Trust Co. and Entrust Group Inc. of advertizing the safety and security of self-directed IRAs without investigating who they do business with. The plaintiffs also claim that the company converted customers’ funds for improper use, fraud, elder abuse, conspiracy and negligence, among other charges, according to the Wall Street Journal.
"Do-it-yourself IRAs" have become more popular because some investors did not do well in the stock market, but still wanted to make more money. These types of IRAs allow the owner to pursue any type of investment except collectibles or life insurance.
Experts say more of these financial fraud lawsuits are likely as regulators fight the increasing number of investment frauds involving elderly American’s retirement savings.
If you or a loved one has experienced financial fraud, contact Sokolove Law for a free legal consultation and to find out if you have grounds to pursue legal action.