SHELBY TOWNSHIP, Mich. – A financial adviser in Shelby Township was arraigned Thursday morning on embezzlement charges after his brokerage license was revoked.
Ernest Romer III, 56, is charged with two felony counts of embezzlement. He was given a $30,000 cash bond on both cases.
Romer is accused of defrauding two Macomb senior citizens, taking more than $220,000 and investing it in an entity he called P&R Capitall, LLC. The money allegedly was transferred into his personal accounts.
ORIGINAL STORY: Shelby Township financial advisor accused of fraud, stripped of brokerage license
The monies were allegedly used to conduct a series of securities transactions at a large loss, and funded his own spending at Kroger, Meijer, Walmart, Target, Costco, Red Box, gas stations and restaurants. He also allegedly made ATM cash withdrawals and transferred some money into personal accounts co-owned with his children.
The Michigan Attorney General's Office revoked his brokerage license.
"These senior citizens placed their trust in this financial broker, and he robbed them blind," Macomb County prosecutor Eric Smith said. "We'll do everything in our power to seek justice and secure what ever money is left for these victims."
St. Clair Shores investor Robert Kowalewsky said he trusted his advisor for 25 years without a reason to worry, until everything went south.
"He needs to be put in handcuffs," Kowalewsky said.
Kowalewsky thought he knew his longtime broker very well.
"You'd never think -- his wife works for a church. He's got three or four kids, always talked about the family and blah, blah, blah," Kowalewsky said. "Next thing I know, I'm getting the shaft."
He gave Romer $46,000 to invest in an individual retirement account. Instead, after the check cleared, Kowalewsky received a frightening IRS notice.
"I owe money in back taxes, $15,000 for stocks that I sold in 2015," Kowalewsky said. "I said I didn't sell any stocks. I put everything into an annuity."
He and his sister immediately hit the internet, where they discovered Romer's long and checkered past. The federal government had barred him from selling securities, and the state of Michigan took Romer's license and fined him $1.5 million.
Romer filed for bankruptcy twice in 2014, and the government dismissed both attempts because he didn't file proper paperwork. But the records show he owed money to the IRS, the state of Michigan and collection agencies.
Kowalewsky filed a civil suit against Romer.
Investigators believe Romer's transactions were part of a larger pattern of felonious financial maneuvers involving a field of investors, with as many as 20 additional victims.
Sign up for ClickOnDetroit Email Newsletters (click here) for more stories like this.