Former N.J. Financial Planner Charged in $300,000 Theft From 78-Year-Old Client

New Jersey Attorney General Peter Harvey announced that the Division of Criminal Justice – Office of Insurance Fraud Prosecutor has obtained a State Grand Jury indictment which charges a former Hunterdon County insurance broker and financial planner with stealing nearly $300,000 from the retirement accounts of a 78-year-old Somerset County resident.

“The charges contained in this indictment allege that a trusted financial planner and insurance broker stole the life-savings of a prominent senior citizen. As a result of the alleged theft, the victim was left penniless, alone, and living in a one-room retirement home,” said Harvey. “Preying on elderly citizens is a crime without heart. I have directed the Division of Criminal Justice, the Division of Consumer Affairs, and the Bureau of Securities to continue to target financial crime against the elderly.”

Criminal Justice Director Vaughn McKoy said that Michael Chamberlain, 63, of Ocala, Fla., (formerly of Califon, Hunterdon County), was charged via a State Grand Jury indictment with theft by unlawful taking (2nd degree), misapplication of entrusted property (2nd degree), and three counts of forgery. If convicted, Chamberlain faces up to 35 years in state prison, a fine of up to $355,000, plus restitution to the victim. Additionally, Chamberlain faces the loss of his New Jersey securities license.

According to Insurance Fraud Prosecutor Greta Gooden-Brown, the indictment alleges that between Sept. 11, 1997 and July 5, 2003, Chamberlain systematically looted the victims’ annuity accounts, invested the monies for his own benefit, and ultimately purchased a resort home valued at more than $400,000 in Ocola.

The indictment also charges that Chamberlain, a licensed securities broker formerly employed at United Planners’ Financial Services of America in Hunterdon County, diverted investment funds from at least three separate American Skandia annuity accounts he managed for the 78-year-old senior citizen.

In 2003, the victim was notified by the Internal Revenue Service that he owed more than $56,000 in back taxes from taxable withdrawals from the annuity accounts. At this point, the victim contacted American Skandia and Chamberlain regarding the status of the accounts. The victim was advised by Chamberlain that the monies had been invested and stolen.

Chamberlain was arrested on July 26 at his Florida residence on a New Jersey warrant charging theft by unlawful taking and forgery. Chamberlain was lodged in the Marion County, Fla., jail pending extradition to New Jersey. On July 30, Chamberlain waived extradition and was returned to New Jersey by State Investigators assigned to the Office of Insurance Fraud Prosecutor. Chamberlain remains incarcerated in the Hunterdon County Jail in lieu of $100,000 cash bail.

The Office of Insurance Fraud Prosecutor investigation determined that the 78 year-old victim attended Princeton University as an undergraduate and graduate programs at Yale University. The victim is a decorated WWII veteran, who was shot down over the Philippines. He now plays organ for his local church and collects money for the Salvation Army.

As a result of the alleged fraud, the senior victim is reportedly without retirement funds, nearly penniless, and living in a one-room retirement home.