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Kaplan Brothers Charged with Fraud and Money Laundering


The Department of Justice has recently filed charges against Adam and Daniel Kaplan, twin brothers who have been accused of defrauding their wealth management clients. These charges follow a previous filing by the Securities and Exchange Commission in March, which accused the Kaplan brothers of similar misconduct.

The Justice Department alleges that the Kaplans misappropriated a staggering amount of at least $5 million from their advisory clients. Shockingly, some of these clients were elderly or disabled individuals who were particularly vulnerable to financial exploitation.

The fraudulent schemes orchestrated by the brothers involved tactics such as overbilling clients for advisory fees and siphoning money from their bank accounts. In some cases, the Kaplans allegedly fabricated fees or made false claims about investments that they had no intention of pursuing. Instead, the funds were used for personal luxury expenses and lavish purchases.

Christie Curtis, the acting assistant director-in-charge at the FBI’s New York field office, condemns the Kaplans’ actions, stating, “As alleged, the Kaplans engaged in multiple investment fraud schemes that victimized their clients. This type of illegal activity is unfortunately all too common and even more egregious when vulnerable groups are targeted.”

Prior to their involvement with IHT Wealth Management in 2018, both Adam and Daniel Kaplan had professional experience at major financial institutions such as Morgan Stanley and Merrill Lynch. However, their tenure at IHT was marred by an elaborate fraudulent scheme that targeted dozens of clients – including close family friends and neighbors.

As we eagerly await further updates on this case, IHT has declined to provide comment regarding the allegations made against the Kaplan brothers.

Financial Advisors Accused of Scams and Misappropriation

Alleged Scams

In one of the alleged scams, the Kaplans lured their clients by claiming that their advisory fee would be 1% or lower, but surprisingly left the actual fee percentage blank in the service agreement. According to prosecutors, after the victims signed the advisory agreements, the defendants deceitfully filled in higher fees, exceeding 2% in most cases. This overbilling scam resulted in a loss of $540,000 for the clients, with the Kaplans pocketing 80% of the amount.

Misappropriation of Funds

Tactics to Conceal Misconduct

To conceal their alleged misconduct, the advisors employed various deceitful tactics. Some victims were told that the charges appearing on their accounts were their owed advisor fees, while others were informed that these charges represented payments for actual investments. Furthermore, prosecutors claim that the Kaplans made Ponzi-like payments to early investors, in an attempt to mask their fraudulent activities.

Indictment and Charges

The brothers now face a 16-count indictment, including charges of conspiracy to commit wire fraud, wire fraud, investment advisor fraud, and money laundering. If convicted, they could be sentenced to up to 20 years in prison, according to the Justice Department.

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