Investment advisor steals $340,000 from Dominican University

Illinois man pleads guilty to defrauding companies and individuals out of $16M

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By Devin Rose

Staff Reporter

A man who took $340,000 from Dominican University over eight months pleaded guilty last month in federal court in Peoria to mail fraud and money laundering.

The university found out from an investigator in March that Timothy J. Roth had been transferring money out of an account Dominican had with Hickory Point Bank, a small, independently owned Central Illinois bank, said Amy McCormack, senior vice president of finance and administration for the university.

The News-Gazette of east central Illinois reported that Roth, 56, of Stonington, began removing money from the investment plan accounts of mutual fund clients for his own use in 2004. In 2006, he began transferring, liquidating and removing shares from accounts of seven mutual plan option clients for his own use.

According to a complaint filed in U.S. District Court in central Illinois, Roth had devised a scheme to defraud and obtain money or property worth at least $16 million between May 2004 and March 2011 using false pretenses.

Roth admitted he defrauded 12 victims, both companies and individuals, in the scheme.

He began working for New Jersey-based Comprehensive Capital Management in 2002, where he managed mutual fund option plans for client companies. That same year, he started providing services to Dominican University. The university was the first to be victimized.

Roth was an investment advisor for the Dominican account, which had been held at the bank for 10 years. But Roth was "not authorized to withdraw any funds," McCormack said. Funds in the account were set aside as part of an employee retirement plan, but employees were not vested in the account. Roth was transferring the funds using fictitious paperwork, likely forging signatures.

McCormack said the school's attorney anticipates the school will be fully reimbursed from the trustee now overseeing Roth's assets. However, last spring, the News-Gazette quoted the court-appointed trustee, a lawyer named Timothy Bertschy, saying it seemed unlikely at that point that adequate funds could be recovered from Roth or the multiple shell companies he controlled to provide full recovery to those victimized.

The Securities and Exchange Commission filed a civil complaint against Roth in March claiming he stole more than $6 million of mutual fund shares from several employee deferred-compensation plans he advised. The complaint alleged Roth took money from plans of companies that were clients of his employer, according to the News-Gazette.

The matter was being investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigations Division, the U.S. Postal Inspection Service, the Securities Department of the Illinois Secretary of State and the Champaign Police Department. The investigation began in March when an investment advisory company to the Champaign Police Department called police.

Roth will be sentenced in July 2012.

Reader Comments

8 Comments - Add Your Comment

Comment Policy

Your joking right  

Posted: November 11th, 2011 4:47 PM

Everyone is talking about the money but no one is talking about how he stole money on serveral times, and still was able to get a job to steal more. it good their money was stolen because I can tell you one thing this man wasn't of color.Because if he was of color if he had a misdemeanor he couldn't get a job at mc donalds hahahahahaahha

Anne from Oak Park, Illinois  

Posted: November 9th, 2011 7:17 AM

And why does OPRF High School have its multimillion reserves invested outside of Oak Park? Good riddance to the office of township school treasurer, but since that office closed, hasn't OPRF pulled money out of Community Bank and other OP & RF financial institutions? Wed. Journal should look at where our schools & village agencies invest their funds, starting with the high school and its $80M in reserves.

Galen Gockel from Oak Park  

Posted: November 8th, 2011 10:00 PM

Jean asks a good question. Dominican University has no reason to invest its funds outside the Oak Park, River Forest, Forest Park communities. We have community-owned banks, and a load of talented financial advisors in these communities. Shame on Dominican.

Someone who knows from River Forest  

Posted: November 8th, 2011 9:38 PM

Professor, to answer your question, No. They are two different people, though both are quite intelligent, lovely women.

Professor Peter Van Nostrand  

Posted: November 8th, 2011 5:27 PM

Is the Amy McCormack in this article the same person that serves on the Board at OPRF High School (Amy Leafe McCormack)?

Jean  

Posted: November 8th, 2011 4:34 PM

why is Dominican investing in a small independent bank in central Illinois, presumably managed by bankers they know nothing about -- when they could instead be putting it in a small independent LOCAL bank in Oak Park and River Forest, namely Community Bank of OPRF with bankers with a proven track record that are known and trusted in the community???

Q from Oak Park  

Posted: November 8th, 2011 4:17 PM

Does this make sense? "The investigation began in March when an investment advisory company to the Champaign Police Department called police." Is it suppose to mean that the Champaign Police Department had an advisory company working for them, and then the advisory company found evidence of deception and then called the Chapaign Police Department?

Anthony K  

Posted: November 8th, 2011 3:38 PM

Free advice, instead of hiring an "investment advisor". Go to fidelity.com, open an account. Find some low-cost stock and bond index funds. Allocate: 50% S&P 500 15% Small Cap Value 25% Bond Fund 10% Money Market/Cash Good Luck

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