Trusted Financial Adviser Changes Course

Trusted Financial Adviser Changes Course

He betrayed their trust by walking away with millions of their dollars. Here's the story of a financial adviser gone rogue and what you need to know to avoid falling victim to a similar scam.
Edward Kahler was a financial adviser who worked for a subsidiary of AIG for more than 20 years.

Jeremy Leder, US Postal Inspector said, “He was authorized to sell things like life insurance and annuities to people who are either about to retire or have already retired.”

For most of Kahler’s career, he was very successful and honest. But then, authorities say he changed course.

“At some point, he decided he wasn’t making enough money doing what he was doing and decided to start defrauding some of his clients," Leder said.

Having spent decades in the business – Kahler already had a key element necessary to pull off a scam: trust.

“He had many, many years of legitimate business with some of these clients. When he decided to defraud these people it was as simple as asking them to write him a check. Every single victim we talked to said “we trusted him”," said Leder.

Kahler’s request that clients write their checks out to him should have set off alarms. If a consumer is investing with a firm, any checks or payment would be made to a company-- not an individual.

“They would write him checks, large checks, in the amount of $50 to over $200,000 dollars," said Leder.

Postal inspectors say the nationwide fraud affected accounts totaling $190 million dollars and Kahler spent the money on himself.

“In reality, he took the money and spent it on lavish expenses, trip to Vegas with his wife, cars, etc," explained Leder.

Inspectors say he was brazen.

“He located someone who was deceased, whose annuity had not been cashed out and basically with just a few clicks of a mouse he was able to surrender the account and had a check for over than $100-thousand dollars sent to his own PO Box that he controlled," said Leder

After several complaints were filed, law enforcement quickly caught up with Kahler.

“At no point during our interactions on several occasions did ever admit or say he was sorry for doing what he did. I think he would have continued to do this fraud had we not stepped in and shut him down," said Leder

Kahler was convicted of mail and wire fraud charges and could face up to 20 years in federal prison.

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