Former Financial Adviser from Gloucester County Pleads Guilty to $900,000 Investment Fraud
CAMDEN, NJ—A former financial advisor from Mantua, New Jersey, admitted today to defrauding his clients of more than $900,000 by diverting their investment checks for his personal use, U.S. Attorney Paul J. Fishman announced.
John Montague, 59, pleaded guilty today to an information charging him with one count of wire fraud. Montague entered his guilty plea before U.S. District Judge Noel L. Hillman in Camden federal court.
According to documents filed in this case and statements made in court:
Montague was licensed to sell mutual funds, variable annuities, and insurance premiums – but at no time was he licensed to sell corporate or municipal securities, direct participation programs or options. Montague engaged in a scheme to defraud his clients by soliciting and inducing them to purchase investment vehicles Montague knew he was not authorized to sell. Montague described the investment vehicles to his clients as guaranteed investments and promised a rate of return of approximately six percent. Montague instructed his clients to make their investment checks payable to him. He then deposited the checks into his personal bank accounts. To maintain the clients’ confidence in the investments, Montague issued periodic “dividend” checks to his clients.
The wire fraud charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 28, 2014.
U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Edward J. Hanko in Philadelphia, for the investigation leading to today’s guilty plea.
The government is represented by Attorney in Charge R. Stephen Stigall of the U.S. Attorney’s Office Criminal Division in Camden.