A Boston-area financial advisor has been sentenced to four years in prison for stealing about $650,000 from his clients in just 12 months. John Babiarz was a legitimate financial advisor at one time, but he is no longer registered with the state of Massachusetts. He was charged with wire fraud, mail fraud, aggravated identity theft and money laundering.
Dorothy Kerzner had a tough time accepting she lost more than $250,000 to a man she once trusted with her investments. John had been her financial advisor for years, and she considered him a friend.
When an investigator knocked on her door to tell her a large portion of her life savings were gone because of fraud, she couldn’t believe it.
"I could not get Dorothy to understand what had happened to the bulk of her life savings until I showed her a copy of the check and on the reverse of the check and she saw her endorsement and then the deposit stamp of that deposit going into an attorney account," said Fred Busch, a postal inspector. "That's the time she realized she was defrauded."
Dorothy had given John permission to liquidate some of her investments to buy Facebook stock for her portfolio. Instead of making that investment, he used that money to buy a new house in cash.
"He would have them send checks to him or do electronic funds transfers into his own account," Busch said. "That is how he would embezzle the money. He was very unsophisticated but these investors were very trusting. These people knew his family, they had known him for years, invested with him for years had no reason at all to worry about him."
Dorothy was one of seven victims who lost about $650,000. John Babiarz pleaded guilty to aggravated identity theft and wire fraud, and he was sentenced to four years behind bars. The court also ordered that he pay more than $645,000 to his victims.