Ex-Broker Charged With Stealing a Client’s Life Savings

What You Need to Know

The ex-broker allegedly embezzled more than $1 million from a client’s retirement account.
The client's home entered foreclosure because he thought the advisor was making mortgage payments on his behalf.
The last firm that the former broker was registered with was SunTrust Investment Services.

A former broker was charged with federal wire fraud and aggravated identity theft in connection with a fraud scheme in which he allegedly embezzled more than $1 million from a client’s retirement account, leaving him with a $63,000 tax bill and his home in foreclosure, according to Jonathan F. Lenzner, acting U.S. attorney for the District of Maryland.

A criminal complaint was filed against Eddy Blizzard, 42, of Perry Hall, Maryland, on Wednesday in U.S. District Court for the District of Maryland and was unsealed upon Blizzard’s initial appearance Friday.

The last firm that Blizzard worked for was SunTrust Investment Services (now Truist), where he was a registered rep from 2014-2017, according to his report on the Financial Industry Regulatory Authority’s BrokerCheck website.

He was discharged July 27, 2017, because SunTrust alleged that he violated the firm’s policy and procedures related to trade execution and error reporting, according to BrokerCheck.

Truist declined to comment on Tuesday.

FINRA suspended Blizzard on June 29, 2018, because he allegedly “failed to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance,” it said.

Blizzard never joined another firm and is no longer registered as a broker or RIA, according to BrokerCheck. He started his career with UBS in 2001, his BrokerCheck report shows.

Client Meetings, in a Car

According to the affidavit filed Wednesday in support of the criminal complaint against Blizzard, his “victim,” identified only as “R.M.,” was a resident of Maryland who was 75 years old in January 2020. On Dec. 12, 2019, R.M. was interviewed as part of the investigation.

R.M stated to investigators that, in 2003, after about 40 years of service with an air conditioning company, he took a buyout and retired. Six months later, R.M. decided to invest his retirement funds to provide an inheritance for his grandchildren, according to the affidavit. R.M. sought investment advice from “Bank 1,” where he had his depository accounts and where Blizzard started working shortly after R.M. started investing there.

Blizzard became R.M.’s advisor and, in about 2005, Blizzard told the client that he started working as an independent advisor and asked R.M. if he wanted to leave Bank 1 and use Blizzard as a full-time advisor. Blizzard allegedly told R.M. that it would be a while before he had his own office, but he would continue to work out of the Bank 1 branch in Catonsville, Maryland.

A review of publicly available FINRA records showed that Blizzard never went to work as an independent advisor, according to the affidavit.

About once a month, R.M. would drive from his new home in Chester, Maryland, to meet with Blizzard at Bank 1 in Catonsville, about one hour away; but R.M. and Blizzard would meet in Blizzard’s car, not the office, according to the affidavit. The meetings lasted 30-45 minutes and R.M. was never told why they were meeting in Blizzard’s car.

Blank Checks

In about 2010, at Blizzard’s request, R.M. gave Blizzard 15-20 signed blank checks, which Blizzard used, according to the affidavit. During the years of investment with Blizzard, R.M. stated he believed his retirement funds were protected and would not lose value. R.M. also believed his mortgage was being paid by Blizzard according to the affidavit.

After multiple instances in which he tried to withdraw cash from his account and was informed he did not have sufficient funds, R.M. tried to contact Blizzard by phone and received no response. R.M. went to Blizzard’s Perry Hall residence to talk to Blizzard in person, knocking on the front and back doors, according to the affidavit.

No one came to the door but R.M. received a voicemail from Blizzard while he was still at Blizzard’s home. In the voicemail, Blizzard allegedly stated the neighbors had called him to complain about the banging on the door. As detailed in the affidavit, Blizzard further explained that all of R.M.’s money was gone.

Missing Money

A review of R.M.’s depository and investment accounts showed that, between January 2013 and August 2019, there were a total of 242 distributions totaling about $1.4 million from R.M.’s retirement accounts, according to the affidavit. Of those, 129 distributions totaling $1.2 million were specifically requested from R.M.’s retirement accounts instead of being regular systematic annuity payments.

After taxes and fees were deducted from those requested payments, about $1 million was deposited into R.M.’s Bank 1 account, according to the affidavit. This review allegedly also revealed that, from April 2016 to April 2019, Blizzard deposited about 112 checks drawn on R.M.’s account into various bank accounts at Bank 1 and elsewhere that were held by Blizzard jointly with his wife or individually. Those checks totaled about $848,000 and were written to Blizzard or Blizzard’s wife.

A review of the checks showed that almost all of them had comments written on the memo section indicating various purposes, including payment of property taxes, construction, boat payments, and down payments for a new house, according to an affidavit.

Tax Bill, Foreclosure

To make matters worse, R.M. received a letter from the IRS, which he turned over to Blizzard as Blizzard had instructed, the affidavit alleged. R.M.’s relatives later determined that R.M. owed about $63,000 in federal income tax due to disbursements from R.M.’s retirement accounts that were allegedly stolen by Blizzard.

In the fall of 2019, R.M.’s home was put into foreclosure because of lack of payment that R.M. thought was being handled by Blizzard. R.M. died on March 20, 2020, according to the affidavit.

If convicted, Blizzard faces a maximum sentence of 20 years in federal prison for wire fraud and a mandatory sentence of two years, consecutive to any other sentence, for aggravated identity theft, according to Lenzner.

At the initial appearance in U.S. District Court in Baltimore, U.S. Magistrate Judge Deborah L. Boardman ordered that Blizzard be released pending trial, Lenzner said.