Adviser Fined $1.6 Million for 25 Years of Pension Fraud

A Florida-based investment adviser has been ordered by the US District Court for the Southern District of Florida to pay more than $1.6 million in restitution for his involvement in 25 years of fraud against a Palm Beach pension trust.

The order comes after William Minor, operator of Multi Financial Insurance Corp., was sentenced in November to 41 months in prison and three years of supervised release. In September, Minor pleaded guilty to one count of mail fraud.

An investigation led by the US Department of Labor’s Employee Benefits Security Administration (EBSA) found that between 1991 and 2016, Minor transferred approximately $2 million from the Rehabilitation Center for Children & Adults Inc. Pension Trust to accounts he controlled, and used the pension’s assets to benefit himself and his family.

The Rehabilitation Center for Children & Adults Inc. is a Palm Beach-based nonprofit rehabilitation center that provides outpatient physical, occupational, and speech therapy to children and adults. Minor served as a volunteer member of the center’s board of governors.

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According to the EBSA, in October 1991, Minor moved plan assets to Transamerica Life Insurance and Annuity Co., for which he registered as an insurance agent. Minor told the rehabilitation center and plan trustees that Multi Financial Insurance Corp. would work in partnership with Transamerica to administer the plan. This was despite the fact that Transamerica had no partnership with Minor, and did not provide any administrative or recordkeeping services for the plan. As a result, Minor was able to exercise control of the plan, said the EBSA.

Minor allegedly used his authority to direct one plan trustee to endorse benefit checks from Transamerica to Multi Financial Insurance Corp., with the understanding that Minor would then issue payments to certain plan participants. In other instances, Minor forged the trustee’s signature on the checks and opened a bank account in the name of “Trustee for the Rehabilitation.”

Because the checks were made payable to the Trustee for the Rehabilitation account, Minor was able to directly deposit the checks into the account without the endorsement of the plan trustee.

EBSA said it determined that Minor made 63 fraudulent requests to Transamerica for lump-sum benefits checks for participants not entitled to plan benefits. Minor allegedly deposited 15 checks into the Multi Financial Insurance Corp. account and 48 checks into the Trustee for the Rehabilitation account.

Tags: Labor’s Employee Benefits Security Administration, Multi Financial Insurance Corp, Transamerica Life Insurance and Annuity Co., William Minor

Wall Street has come under a lot of fire since the financial crisis, for being greedy and for sticking it to the nation’s economy. But why stop there? A new survey finds almost half the respondents believe Big Finance has made attaining the American Dream harder.

In a poll by RealClear Opinion Research, a full 46% said that Wall Street had made achieving that goal “more difficult”—with 26% saying Wall Street made no difference, 13% indicating achieving the dream was easier, and the rest not knowing.

Now, the poll takers didn’t define the American Dream for its respondents. The term was coined by James Truslow Adams, a writer and historian, in a 1931 best-selling book called The Epic of America. He said that the dream was one of upward mobility.

In Adams’ view, this was a “dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement. It is a difficult dream for the European upper classes to interpret adequately, and too many of us ourselves have grown weary and mistrustful of it.”

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Writing during the Great Depression, when a large chunk of the population was jobless and poverty was rampant, he noted that a cynicism had developed among some Americans that such an uplifting dream was possible.

In the same vein, nowadays there is widespread doubt about how achievable upward mobility is. According to the Federal Reserve’s 2016 Survey of Consumer Finances, the top 10% of the income pyramid garnered 25% of the nation’s income and held 75% of its wealth. This increasingly one-sided trend been under way for years, starting in the 1970s.

Wall Street has been low on the public trust list for the past decade, and is widely blamed for the 2008 financial crisis, with some justice. Subprime mortgages packaged into bonds were a big part of the meltdown. A 2007 Bloomberg poll found that only 31% of Americans viewed Wall Street favorably.

For what it’s worth, in the RealClear survey, Wall Street wasn’t the biggest villain, stopping people from realizing the American Dream. No. 1 was Congress (56%), followed by President Donald Trump (51%), the judicial system (47%), and the Republican Party (46%).

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Tags: inequality, upward mobility, Wall Street