2/1/2013 1:45:00 PM Stonington man fined $16M, sentenced to 12 years
PEORIA, Ill. (AP) — A former Urbana investment adviser has been sentenced to more than 12 years in prison for defrauding clients of millions of dollars.
The U.S. Department of Justice says 57-year-old Timothy J. Roth, of Stonington, was sentenced Thursday in federal court in Peoria to 12 years and seven months in prison. Roth was also ordered to pay $16.15 million in restitution to people who lost money. He pleaded guilty to mail fraud and money laundering in October.
The Justice Department says Roth admitted that he moved mutual fund shares out of clients’ accounts and sold them to use the money himself.
Roth worked for a Champaign money-management firm at the time. He has since moved back to Stonington.
On March 21, 2011, the Securities and Exchange Commission (SEC) obtained an emergency court order freezing the Roth’s assets for stealing more than $6 million of his clients’ mutual fund shares, liquidating the shares, and sending the ill-gotten gains to various accounts and companies under his control. The court also entered a temporary restraining order prohibiting Roth from violating the anti-fraud provisions of the federal securities laws.
According to the civil complaint filed by the SEC, Roth worked for Comprehensive Capital Management, Inc., a New Jersey-based registered investment adviser. The SEC’s complaint alleges that from October 2010 through February 2011, Roth stole more than $6 million worth of mutual fund shares from several employee deferred compensation plans for whom he provided investment advice. According to the SEC, Roth, who worked out of CCM’s office near Urbana secretly caused the plans’ mutual fund shares to be transferred to an account under his control, even though no such transfer had been requested or authorized by the plans’ participants.
The SEC said that after selling the plans’ shares, Roth funneled the cash proceeds to various accounts and companies under his control or for his benefit. According to the SEC’s complaint, at the time he was engaging in his scheme, Roth did not tell the plans or their participants about the transfers. Instead, Roth sent them bogus account statements that deliberately omitted his surreptitious transfer of the mutual fund shares. Thus, the account statements overstated the Plans’ account holdings and concealed Roth’s theft.
Involved in the investigation were: the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations Division; the U.S. Postal Inspection Service; the Securities Department of the Illinois Secretary of State; and, the Champaign police.