Pat Butcher has managed to keep her retirement nest egg intact during an Alaska cruise planned for her 70th birthday this October. However, she fears she might have lost over $200,000 that her investment advisor had set aside for her future.
To cope with her financial struggles, Butcher took on part-time work and secured a home equity loan last fall after her advisors stopped sending her monthly payments of $1,600 to $1,700 with interest. “I trusted these people and it really hurt me,” she expressed.
Findings by Newsday
- Masapequa-Based Firms: Investment firms are being accused of misappropriating significant sums, some in the millions, from retirement accounts.
- Ag Morgan Financial Advisors LLC: The company’s CEO, Vincent J. Camarda, and President James E. McArthur, have faced multiple lawsuits, regulatory complaints, and FBI scrutiny.
- Camarda’s Credentials: He reportedly lost his financial planner certification, and the AG Morgan website is no longer active.
Butcher is among at least 20 clients of Ag Morgan Financial Advisors LLC, who allege the Massapequa-based firm mismanaged their savings. Reports indicate that losses could reach into the hundreds of thousands or even millions of dollars, impacting up to 400 clients, many of whom are elderly. Many have returned to work, taken on debt, or relied on family to avoid losing their homes.
In conversations, some clients voiced skepticism about ever recouping their losses, especially as it seems AG Morgan is winding down operations. The office on Merrick Road appears abandoned, its website is inactive, and the firm is entangled in legal troubles, including fraud charges filed by the SEC in 2022.
A letter to clients, which Newsday obtained, indicates the FBI has been probing AG Morgan since February, warning that clients might be victims of criminal activity, and mentioning a large number of victims.
The extent of the affected investors isn’t clear. Despite AG Morgan stating around the end of 2023 that they had approximately 390 clients with $175 million in assets, court proceedings indicated the company had claimed closer to 1,000 clients.
Tim Dennyn, a lawyer from Northport representing retirees, has noted alarming signs of malfeasance, hinting that his client’s funds were shifted like in a Ponzi scheme. He questioned the potential for victim compensation in the end.
With ongoing lawsuits against AG Morgan, the future for victims remains uncertain. Dennyn speculated that a federal court-ordered reparation fund could be their best option, similar to what was done for victims of notorious fraudster Jordan Belfort.
Neither Camarda nor McArthur responded to numerous requests for comments, and attempts to contact them at their Massapequa office in recent months yielded no answers. The premises are reportedly up for sale.
A victim from West Suffolk County recalls confronting Camarda over the phone regarding significant investment losses and receiving no substantive response. She wishes to remain anonymous to protect her reputation at work, citing that her investment group, once deemed reliable, has left her in disbelief over the sudden changes.
Her AG Morgan account previously indicated a balance of $3.2 million with interest payments of $32,545, which have now ceased since January 2024. She struggles to comprehend the abrupt losses. “Why does this have to happen? It feels like more than just greed,” she lamented.
Clients, Regulators, and Legal Proceedings
Camarda, who started AG Morgan in 2014 after a lengthy career in finance, has faced significant personal turmoil, including a divorce in 2011, partially attributed to the stress of Super Storm Sandy. At AG Morgan, he claimed to make $60,000 monthly, advertising alternative investments with attractive returns.
Records from an FBI victim survey show that client funds were funneled into various investment vehicles managed by Camarda. Many clients expressed frustration over halted interest payments and excuses for delays that felt insincere.
Complaints filed against Camarda number in the hundreds, with claims totaling over $23 million, alongside various pending damages against McArthur. These complaints often overlap with those in the SEC’s allegations, which accuse the firm of unethical securities sales without disclosures of substantial debts that created conflicts of interest.
Court documents reveal that AG Morgan solicited more than $75 million from upwards of 200 investors between 2017 and 2020 without proper registration. Meanwhile, the CEO of the company linked to their investments received a significant prison sentence for fraud.
The process for recovery seems bleak, with Camarda allegedly failing to disclose crucial legal issues to clients in subsequent meetings. A retired client shared that after being promised security for her investment, she was left without explanations when payments ceased. She expressed deep disappointment, saying it has overwhelmed her life and that she fears she may never recover her $205,285 investment.
“I don’t have a good feeling about how this will end,” Butcher stated.
