A former real estate investor who also served as the usher at a Seattle-area church pled guilty to running a securities fraud scheme that led to the theft of more than $3 million from at least 23 families, many of whom were members of his church.
Eighty-six-year-old Stephen Klos recently pled guilty to 10 counts of securities fraud for his role in running a Ponzi scheme that targeted elderly victims. Along with another man, Klos began operating the scheme in 2004 when he began asking members of his gym and the Mercer Island Church, where he worked as an usher, for investments.
The pastor at Mercer Island later said that Klos was very popular with elder churchgoers. He added that Klos asked everyone in the church, including the pastor himself, to invest with him.
As the investments began rolling in, Klos and his partner began paying back investors with the money being brought in from new investors. In total, more than $3 million was stolen from people who invested in Klos’ scheme. While the 10 counts of securities fraud represent the 10 victims uncovered by the Department of Financial Institutions’ Securities Division, at least 23 families are thought to have been affected by the scheme.
This is not Klos’ first attempt at perpetrating a securities fraud scheme. In 1992 he was banned from working in any securities and financial businesses for another Ponzi scheme he orchestrated that led to investors losing $3.4 million.
Klos faces up to 68 months in prison for his securities fraud crimes. He will be sentenced in December, the Seattle Times reports.
If you or a loved one has been taken advantage of by a securities fraud scheme, there may be legal options at your disposal. Call Sokolove Law today to learn more about pursuing a securities fraud lawsuit. For legal help, call (800) 581-6358.