Published On: July 10, 2020

Chicago-based Stoltmann Law Offices is investigating reports of selling away and securities fraud engaged in by Douglas Kiffmeyer.  On July 27, 2020, Douglas Kiffmeyer pleaded guilty to 17 counts delivered via indictment in June 2018.  Kiffmeyer pleaded guilty to two counts of wire fraud, 18 U.S.C. Section 1343, 14 counts of failing to timely file income tax returns, 26 U.S.C. Section 7203, and one count of engaging in a financial transaction in criminally derived property, 18 U.S.C. Section 1957.  Kiffmeyer has yet to be sentenced but under federal criminal sentencing guidelines, should received between 46-57 months in prison. At times relevant to perpetrating his criminal scheme, Kiffmeyer was a registered representative and financial advisor for FINRA broker/dealer Brokers International Financial Services, LLC.

According to Kiffmeyer’s FINRA BrokerCheck Report, many of the entities through which he conducted his fraudulent investment scheme were disclosed as “outside business activities” to his member-firm. According to the Stipulation of Facts entered on July 27, 2020, Kiffmeyer’s scam began as investments he solicited in a company called Creative Digital, Inc., which he represented was designing a digital trigger for the M-16 rifle. In total, Kiffmeyer raised $827,000 for Creative Digital, Inc., but spent almost all of the money on a GMC Sierra 1500 truck, a Hummer H2, a motor coach, a Corvette, a Nissan 370, and an engagement ring. According to the Stipulation, of the $827,000 raised, only $1,500 was returned to investors.

Kiffmeyer’s scheme took a different and even more sordid turn next. He began selling promissory notes to elderly investors, convincing them to surrender IRAs and annuity products in exchange for promissory notes bearing interest. One of his victims was 90 years old. The last part of Kiffmeyer’s scam involved selling interests in a medical marijuana clinic. Little, if any, of the $206,000 raised for this company was used for the business and was instead converted for personal use.

Victims of Kiffmeyer’s scam may have legitimate options to pursue recovery of their losses.  First, Kiffmeyer’s broker/dealer, Brokers International had an iron-clad responsibility to supervise his activities. In circumstances like there, the evidence that the adviser is running some sort of scam is everywhere. It’s in his emails, his text messages, its on papers in his office. Reasonable supervision to ensure compliance with applicable securities laws would have likely deterred and even prevented this misconduct from happening.  Second, annuity companies allowing surrenders under questionable circumstances could have liability for aiding and abetting fraud and breach of fiduciary duty.  Lastly, any affiliated entries involved in the scam as aiders or abettors could be responsive for investor losses.

Stoltmann Law Offices is a Chicago-based securities/investment law firm that has represented thousands of investors in cases involving fraudulent investment schemes for more than fifteen years.  If you are victim of investment fraud, please call our law firm for a no obligation consultation with a securities attorney.  We are a contingency fee law firm which means we do not get paid until you do!

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If you have suffered financial losses because of the negligence or fraud of your financial advisor or broker through unsuitable investment recommendations, over-concentration, churning, misrepresenting risks, conversion or selling away, you have legal rights and options to pursue recovery of those losses.

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