HONOLULU — A federal jury on Monday found David E. Ruskjer guilty of numerous charges related to defrauding some 140 clients who had invested more than $19 million. The 60-year-old Kaua‘i man was faces up to 20 years imprisonment for
HONOLULU — A federal jury on Monday found David E. Ruskjer guilty of numerous charges related to defrauding some 140 clients who had invested more than $19 million.
The 60-year-old Kaua‘i man was faces up to 20 years imprisonment for each of the 16 mail and wire fraud charges and up to 10 years imprisonment for each of the 24 structuring and money laundering charges, according to Florence T. Nakakuni, U.S. attorney for the District of Hawai‘i. The jury acquitted Ruskjer of one count of mail fraud.
Senior U.S. District Judge Helen Gillmor set sentencing for Jan. 5, a news release states.
“Investment fraud schemes of any size prey on the trust of victims who believe the representations made by their promoters,” said Marcus Williams, the Internal Revenue Service Special Agent in Charge of Hawai‘i. “As shown in this case, the government will hold the perpetrators of fraudulent schemes accountable and vigorously prosecute them.”
According to the release, evidence presented during the trial showed:
• Ruskjer operated an investment program in Hawai‘i and elsewhere, known as “Ruskjer & Associates,” and/or “Dave’s Investment/Loan Program,” located in Koloa, from approximately Sept. 22, 2004 until Dec. 11, 2008.
• Ruskjer held himself out to clients as a successful investor in options trading, and stated in promissory notes he gave in return for the monies his clients advanced that his options program could pay them 4 to 5 percent per month interest as a return on their money. The earliest investors were promised 10 percent per month and one investor who paid Ruskjer $7.5 million was promised 50 percent per year.
• Ruskjer ostensibly collected monies to be used in trading covered and uncovered options with TD Ameritrade, but in fact, Ruskjer was paying earlier clients with monies he obtained from later clients since there was never sufficient money to support the interest rates he guaranteed his clients.
• Ruskjer only invested about $8 million he collected in the TD Ameritrade account, and by the time the government seized the TD Ameritrade account and other bank accounts, with a combined balance of approximately $4.1 million, on Dec. 11, 2008, Ruskjer owed his clients approximately $19 million in principal and additional interest.
• Ruskjer actually lost over $2.5 million in options trading and spent significant sums of client money enriching himself and developing an unrelated business that never got off the ground.
• Ruskjer used client money to buy himself a $528,400 condominium on Kaua‘i, a $29,000 Honda sedan, and Honda and Suzuki motorcycles for some $10,000.
The case resulted from an investigation by the Internal Revenue Service – Criminal Investigation, the release states. The prosecution was handled by Assistant United States Attorney Leslie E. Osborne Jr.
