U.S. Securities and Exchange Commission

Litigation Release No. 21752 / November 22, 2010

Securities and Exchange Commission v. Financial Services Moskop & Associates, Inc. and Edward L. Moskop, Civil Action No. 10 C 7462, in the United States District Court for the Northern District of Illinois, Eastern Division. 

SEC halts MISAPPROPRIATION SCHEME BY FORMER REGISTERED REPRESENTATIVE

On November 19, 2010, the Securities and Exchange Commission filed an emergency civil action in the United States District Court for the Northern District of Illinois to halt an ongoing fraud on investors conducted by Edward L. Moskop and the company he owns and operates, Financial Services Moskop & Associates, Inc. From 1989 until the filing of the SEC’s action Moskop and his company, Moskop misappropriated most of the life savings of at least two elderly investors. 

The Honorable Rebecca R. Pallmeyer, United States District Court Judge, granted the Commission’s motion for emergency relief, including an order temporarily restraining Moskop and his company from committing further violations of the antifraud provisions of the federal securities laws and an order freezing the assets of Moskop and his company.

The SEC’s complaint alleged that Moskop and his company have defrauded an elderly couple since 1989 by falsely claiming to make securities investments on their behalf. Moskop, who is 62 years old, is a former registered representative and a licensed insurance broker. Moskop is the principal of Moskop & Associates, which is located in Belleville, Illinois. In an earlier incident unrelated to the SEC’s charges, the NASD (n/k/a FINRA) in 1990 imposed an associational bar against Moskop for the misappropriation of client funds. According to the SEC’s complaint in this matter, Moskop received funds from an elderly couple on numerous different occasions throughout the years, with directions to invest their funds in securities such as fixed-rate trusts and certificates of deposit. In reality, the SEC alleged, Moskop misappropriated the investors’ funds and never made the investments. Throughout the scheme, Moskop and Moskop & Associates sent the elderly couple account statements identifying non-existent investments in various securities. According to the SEC’s complaint, Moskop also forged documentation related to the purported investments, including creating counterfeit CDs supposedly issued by a major insurance company. The SEC alleged that Moskop’s fraud caused the elderly couple to lose the majority of their life savings. The SEC further alleged that Moskop recently claimed to have numerous other investors. 

The SEC’s complaint alleges that Moskop and Moskop & Associates, Inc. violated Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder.  The SEC seeks injunctive relief, disgorgement, prejudgment interest and civil penalties. A preliminary injunction hearing in this case is scheduled for November 30, 2010.

See Also: SEC Complaint

 
http://www.sec.gov/litigation/litreleases/2010/lr21752.htm

Last modified: 11/22/2010