Federal Court Orders Illinois Business Owner to Pay $1,439,678, in Restitution, Serve 5 Years in Prison for Fraud Involving Investors’ Savings

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CHICAGO, IL – The U.S. District Court for the Northern District of Illinois has sentenced Lake County, Illinois-based business owner Richard Booy, to serve five years imprisonment followed by an additional three years of supervised release, and to make $1,439,678 million in restitution for defrauding his clients in a Ponzi-type scheme totaling approximately $2 million. As a result of the the March 18, 2019 sentencing, Booy is statutorily barred from serving as a fiduciary under the Employee Retirement Income Security Act (ERISA).

Booy pleaded guilty on July 26, 2018, to one count of mail fraud. Founder of the Libertyville, Illinois-based Principal Financial Strategies, LLC (PFS) and owner and operator of the now-defunct Vernon Hills, Illinois-based Safe Financial Strategies Inc., Booy used the promise of no-risk investments and guaranteed returns to persuade his primarily elderly clients to invest their money with him.

The action follows a joint investigation by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA), the U.S. Postal Inspection Service, and the State of Illinois Securities Department.

“Fraudulent transactions like these can cause irreparable damage to the retirement savings of individuals and their future financial security,” said Employee Benefits Security Administration Regional Director Jeffrey Monhart, in Chicago. “The U.S. Department of Labor is committed to protecting retirement savings and holding those that commit fraud accountable for their actions.”

Although Booy claimed to be affiliated with the widely known Des Moines, Iowa-based investment firm Principal Financial Group, he allegedly had no actual relationship with the firm and was not authorized to invest client funds with it. Booy continued his investment scheme even after Principal Financial Group in September 2016 obtained a temporary restraining order against him that led to a court-authorized seizure of his computer and other evidence from Booy’s home.

The fraud scheme began in approximately August 2012 and continued to about December 2016. Most of Booy’s victims are elderly, and some placed their entire life savings or funds from retirement accounts with him.  Booy often met personally with the victims in their homes, misrepresenting to them that their investments were guaranteed to return a profit. Instead of investing the funds as promised to clients, Booy used the victims’ money to cover personal expenses, including credit card debt and purchases at Best Buy and DirecTV, and to pay earlier investors through Ponzi-type payments.

Employers and workers can reach EBSA toll-free at 866-444-3272 for help with problems related to private sector retirement and health plans. Additional information can be found at http://www.dol.gov/ebsa.

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