Retirees wiped out, lose millions: SEC (invested with KNI Investments)
When it comes to handling our money in retirement, there’s probably one number to keep in mind above all others.
That number? Zero.
For example, it’s the exact percentage of our savings we should be gambling on private companies, meaning those not traded on the stock market. And it’s the amount in round dollars that we should invest with charming, persuasive strangers peddling exotic investment schemes. And it’s also the number of those strangers to whom we should give actual custody of our funds. Oh, yes. It’s also the number of “low-risk investments” that will pay retirees (or anyone else, for that matter) 10% a year, or let alone per month.
Which brings us to the case of investment adviser KNI in Houston, Texas, where the Securities and Exchange Commission reports that as many as 70 investors, most of them apparently retirees and near-retirees, have just lost millions of their hard-earned life savings. In many cases, says the SEC, the retirees have lost everything.
A Texas widow lost her entire $30,000 retirement account. A Nevada individual lost his entire $92,000 retirement portfolio. A Kansas veteran and military professor, who was months away from retirement, lost almost all of his $320,000 retirement savings. An Alabama retiree lost $105,000, while the SEC mentions others who lost between $30,000 and $150,000 their retirement accounts. A retiree in Houston who had been seriously injured at work, and feared she could never work again, was seeking safety and income from her investments as a result. Instead, says the SEC, she lost her entire $75,000 retirement portfolio.
Total losses are about $3.7 million.
The Securities and Exchange has filed suit against KNI, which stood for Knight Nguyen Investments, Christopher Knight Lopez, his brother Jayson Lopez, and Forrest Andrew Jones, accusing them of multiple violations of federal securities laws, including antifraud provisions. The SEC says the violations range from misrepresenting risky investments as safe to manufacturing false financial statements and misappropriating the clients’ money.
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Regardless of the legal ins and outs, the details of KNI’s investments as laid out by the SEC should raise a forest of red flags for any retiree, near-retiree, or their family. According to the SEC, KNI clients were sold securities in at least five private companies involved in things like importing gold and diamonds, consulting, “graphic tools” and travel software. KNI told clients its investment strategy “allows historic gains of +10% p.a. annual without the risk normally associated with them.” One of the companies was allegedly based in the Seychelles, the island chain off the east coast of Africa well known as a honeymoon destination, and was supposed to be selling gold to a refinery in Lebanon. Another company allegedly held patents for peptides—short strings of amino acids—that might cure cancer, among other applications. This company supposedly had a ton of cash held in a bank in London. Investments in these companies were wiped out.
More..
https://www.marketwatch.com/story/retirees-wiped-out-lose-millions-sec-11621608491
