Close Close

Retirement Planning > Saving for Retirement

Ex-Broker Charged With Stealing $1M From Retired Doctor, Wife

Your article was successfully shared with the contacts you provided.

New York Attorney General Eric T. Schneiderman said Monday that he had filed charges against Khawaja Saud Masud for stealing over $1 million from a retired pediatrician and his wife.

The 37-year-old Masud, who lives in Jersey City, New Jersey, persuaded the couple to invest in a purported hedge fund, RKS Capital. If convicted of grand larceny and securities fraud, he could face up to 25 years in prison.

“The defendant allegedly convinced his victims to turn over their retirement savings with promises of a safe, lucrative investment, only to squander their hard-earned dollars,” said Schneiderman in a statement. “New Yorkers should be able to rely on brokers to invest their money as promised.”

According to FINRA BrokerCheck, Masud is not currently registered with any securities firm. He was registered with UBS (UBS) from August 2004 to August 2010.

In 2012, Masud reached out to Dr. Kalim Irfani, then 75, and his wife, Rehana Irfani, to invest their retirement savings in a fund he had created just two weeks earlier. The Irfanis, who live in Westchester, N.Y., allegedly gave him $1 million, which Masud then lost most of over several months.

Prosecutors say Masud “induced the Irfanis to invest with him by falsely representing that his purported hedge fund was a far safer investment than a mutual fund,” according to Schneiderman’s office.

Though he said he was using a conservative strategy, Masud instead appears to have engaged in “highly speculative and aggressive trading with the Irfanis’ money,” the New York Attorney General’s office says. “Prosecutors further allege that just one day after his first trade, to conceal his unauthorized activity, Masud canceled the services of the third-party administrator responsible for reporting his trading activity to the Irfanis. Masud allegedly then continued to trade stocks multiple times a day without the Irfanis’ knowledge or permission, suffering staggering losses.”

He was able to evade or ignore inquiries about the investment for almost a year.

The former rep was arraigned Monday on the indictment before Supreme Court Judge Anne E. Minihan in Westchester County Court. His bail was a $500,000 bond over $250,000 cash.

— Related on ThinkAdvisor: