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Regulation and Compliance > Federal Regulation > SEC

Investment Advisor Charged in $6 Million Theft

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The SEC, and, separately, the U.S. Attorney’s Office for the Southern District of New York, have charged the co-Founder and Principal of AFW Wealth Advisors, Matthew D. Weitzman, an investment advisor, with stealing “more than $6 million in investor funds for his own personal use, in some instances victimizing clients who were terminally ill or mentally impaired,” according to an SEC announcement and complaint filed on June 10.

The SEC complaint alleges that, “From at least 2005 until March 2009, Weitzman misappropriated millions of dollars from the clients of AFW Wealth Advisors, the business name for AFW Asset Management, Inc., a registered investment adviser co-founded by Weitzman (“AFW”). He used this client money entrusted to him for investment as his personal piggy-bank to furnish a lavish lifestyle, which included a multi-million dollar home, an interest in a horse, cars, and other expensive luxury items.” The complaint says Weitzman “misappropriated client funds invested through managed accounts held at a registered Broker-Dealer,” transferring them “directly into one of his personal bank accounts.”

Weitzman was, until March 30, chief compliance officer for AFW Asset Management which was “doing business under the name AFW Wealth Advisors,” in Purchase, New York, and Natick, Mass. He founded AFW in 1993, the SEC complaint states.

In an June 10 email to clients that was obtained by Wealth Manager, AFW Wealth Advisors Founding Principal Jay W. Furst said: “Mr. Weitzman was arrested this morning and charged with stealing $6 million from AFW’s clients. The criminal complaint filed in the United States District Court for the Southern District of New York charges Mr. Weitzman with committing multiple counts of investment adviser fraud, securities fraud and wire fraud. The charges were brought by the United States Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation. Mr. Weitzman faces years of imprisonment if he is convicted of the charges in the criminal complaint. Earlier today, Mr. Weitzman appeared before a judge in Manhattan federal court and was released on bail.”

Furst added that, “AFW has been fully cooperating with the U.S. Attorney’s Office and the SEC since the discovery of Mr. Weitzman’s theft. AFW is continuing to work with both agencies to effectuate the reimbursement of the victims of Mr. Weitzman’s misconduct.”

Weitzman and AFW received national attention after New York Times Columnist Ron Lieber wrote about them in his April 17 column, “How a Personal Finance Columnist Got Caught Up in Fraud.” In it, Lieber said that his own planner–Weitzman–was, according to AFW, “now on leave, was not expected to return (ever) and would have ‘no further contact with any client accounts.’”

In a follow-up column called “Finding Financial Advice in an Age of Bad Behavior” on June 5, Lieber described his reasons for selecting Weitzman in the first place, including Weitzman’s Ivy League background and that he was a member of NAPFA–the well-thought-of National Association of Personal Financial Advisors.


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