Cape man accused in $350,000 swindle

Date: Tuesday, September 29, 2009
Author: Sarah Shemkus, Cape Cod Times

Three years after being fired, fined and professionally sanctioned for misappropriating clients' funds, Hyannis resident and former financial adviser Shane Selewach is facing criminal charges for allegedly stealing nearly $350,000 from investors.

Selewach was arraigned at Barnstable District Court Thursday on six counts of larceny over $250; he pleaded not guilty and was ordered held in lieu of $20,000 bail.

The criminal complaint, which was filed following an investigation by the state attorney general's office, contends that Selewach told six clients their money would be invested in real estate projects or commodities funds.

Selewach then spent the money on mortgage and car loan payments, credit card bills and personal entertainment, including tickets to a Boston Celtics game, the complaint alleges.

Reached by phone, Selewach's attorney, Seth Roman, declined to comment.

The six clients mentioned in the criminal complaint are each alleged to have lost between $11,450 and $110,000.

The alleged victims could not be located yesterday. Harry Pierre, spokesman for the attorney general's office, said he could not be certain the investors live on Cape Cod.

These charges come three years after William Galvin, secretary of state, filed an administrative complaint accusing Selewach of pocketing an estimated $250,000 invested by another five clients.

At the time, Selewach was working for Ameriprise Financial Services.

According to Galvin's original complaint, Selewach persuaded a handful of clients to take their money out of Ameriprise accounts and invest in a new commodities hedge fund he was creating, often failing to make it clear that the new investment was not approved by the financial services company.

Among the victims was a woman in her 80s whose stated investment goal was to have sufficient money to pay for nursing home care. She lost $71,000, according to documents from Galvin's office.

Selewach then deposited the money in personal accounts and used it to pay for his mortgage and cars from BMW and Daimler Chrysler, the complaint contends. The funds also paid for travel to Europe, florists in Moscow and the services of a company that advertises itself as "one of the world's largest Russian-American introduction and romance tour companies."

In connection with these charges, Selewach agreed to pay a $5,000 fine and to have his registration with the Massachusetts Security Division suspended for three years.

He was fired from his job with Ameriprise in 2006, and in February 2008, the Financial Industry Regulatory Authority permanently barred him from acting as a securities broker.

In the transactions leading to the recent criminal charges, Selewach failed to tell investors that he was not registered as a securities broker, according to a press release from the attorney general's office.

Selewach is next scheduled to appear at a probable cause hearing in Barnstable District Court on October 21.

The maximum penalty for each charge is five years in state prison or two years in the house of corrections and a fine of $25,000.