Silver Law Group Represents Florida Seniors in Elder Fraud Cases
In a scene we’ve seen too many times, two Florida men took money from investors and used it themselves under the guise of “investment strategies.” Unfortunately, these two companies and their owners targeted small businesses as well as senior citizens, taking one woman’s entire life savings.
Silver Law Group represents seniors in cases of elder financial fraud. Our attorneys have handled multiple cases of investment fraud by stockbrokers, unregistered financial advisors, and even family members. Many of our cases involve affinity fraud where members of a community are misled by someone they trust. Our attorneys work on a contingency fee basis and only get paid if we recover money. Scott Silver, our managing partner, regularly speaks at community events about how to avoid being a victim of elder financial abuse.
Just this past September, the duo acquired $123,000 from a 70-year old investor, and raised $1.49 million in 2019. The monies were quickly misused.
In an SEC press release, the agency details how multiple senior investors and small business owners were targeted by Neil Burkholz, age 82, of Boca Raton, FL and Frank Bianco, age 70, of Hollywood, FL. The complaint included the names of Burkholz’s wife and Bianco’s wife as “relief defendants.” South Florida resident Neil Burkholz is a senior himself, demonstrating the need to be wary of people in your own community.
The two men are owners of Shore Management Systems and Palm Financial Systems, LLC, the companies that promised investors big returns while taking their money and either misappropriating it, or using it to pay “dividends” to other investors. They targeted South Florida seniors for their actions.Committing Elder Fraud
Since 2014, these individuals and their two companies raised more than $6 million, primarily from senior citizens based in Florida. Other investors were from Maryland, Illinois, and Phuket, Thailand.
The 55 investors were between the ages of 65 and 100, with many liquidating retirement savings and other large assets in order to invest. Most of this money is now gone. Less than half of the investors’ funds were invested, and those that were invested resulted in almost total losses.
Ironically, Burkholz, Bianco, and their wives are senior citizens themselves. Their website indicates that they were targeting “high-net worth investors,” and that they have 27 years of experience and $2 billion in assets. Palm Financial Management’s website hasn’t been updated since 2017, and their blogs and reports are nearly two years old.Deceptive Promises Of Bigger Returns
The two men falsely claimed that their proprietary options trading strategies were highly lucrative and profitable “alternative investment strategies.” They presented their companies as legitimate investment management companies, and described their private securities offerings with high rates of returns, at one point over 100%.
Bianco and Burkholz provided documents to investors stating that they would proactively manage all investor funds, using “advanced trading strategies they developed to produce safe, secure, and higher-than-market-rate returns. These documents also stated that Bianco and Burkholz would receive the equivalent of a 2% annual fee in exchange for their management services. Unfortunately, according to SEC documents, nothing could be further from the truth.
The SEC’s complaint also indicates that:
“To create the appearance of legitimacy, Bianco and Burkholz give prospective investors elaborate private placement memoranda, subscription agreements, and operating agreements. These documents claim that Defendants will actively manage the victims' money in investment funds that primarily use securities options and hedging strategies, aided by an algorithm or other proprietary investment selection criteria, to earn profits.”
They backed up their claims with falsified account statements and other information provided to investors, who were unaware that their money was being badly invested and re-directed to personal accounts.
The SEC took emergency action to file a restraining order and freeze assets from the two companies on November 19, 2019, when they filed the petition in US District Court in the Southern District of Florida. They are prohibited from soliciting new investors, and are required to provide sworn and accurate accounting of their assets. While federal regulators are still collecting evidence and data, the case is an ongoing investigation.
The complaint charged the two defendants and their wives with securities fraud and “unjust enrichment.” The SEC is seeking emergency relief as well as permanent injunctions, as well as disgorgement all ill-gotten gains with civil penalties and prejudgment interest.
Palm Financial Systems’ website is still operational, and invites potential investors to informational workshops on Saturday mornings at their office in Coconut Creek, FL. Both Neil Burkholz’s and Frank Bianco’s LinkedIn pages are still active. The entire SEC complaint is available here.Did You Invest With Palm Financial Or Shore Management Systems?
Silver Law Group represents investors in securities and investment fraud cases. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases are handled on a contingent fee basis, meaning that you won’t owe us until we recover your money for you. Contact us today and let us know how we can help.