Lawsuit Says NRP Financial Ignored Fraud Scheme
Minneapolis attorney R.J. Zayed, who also is the appointed receiver responsible for helping victims recover assets lost in a $194 million fraud scheme, has filed a federal lawsuit against broker/dealer NRP Financial for allegedly “assisting in the proliferation of one of the largest Ponzi schemes in Minnesota history.”
Among other things, the lawsuit accuses NRP Financial of failing to supervise one of its former brokers, Jason “Bo” Beckman. Beckman worked at NRP from November 2005 to February 2008. According to the lawsuit, Beckman raised $47.3 million for the scheme from at least 143 investors.
Beckman is the one-time owner of the now-defunct Oxford Private Client Group (PCG), which served as NRP’s branch office in Minneapolis. Beckman was one of three Cook associates who faced federal conspiracy charges related to activities involving the promotion of a bogus currency investment program, which offered investors high annual returns without any risk to capital. Investors ultimately lost more than $150 million after the scheme imploded in July 2009. Cook admitted to the fraud and was sentenced to 25 years in prison, according to a Jan. 6 story in the Star Tribune.
In the complaint against NRP, Zayed contends the firm turned a blind eye to Beckman’s alleged illicit activities, creating a “flimsy and obviously whitewashed paper trail to conjure the illusion of supervision and oversight where none actually existed.”
As an example, the complaint cites an incident in which NRP challenged a claim regarding Beckman’s marketing materials, but then failed to follow up and instead allowed him to continue misleading clients.
“Through PCG alone, Beckman raised at least $47.3 million for the currency program from at least 143 investors residing in numerous states,” the lawsuit says. “His pitch was just complicated enough to be inscrutable but convincing, especially given that it came from a registered representative associated with a respected broker-dealer with offices located throughout the United States.”
Ohio-based NRP Financial is now being merged into LPL Financial Retirement Partners, a subsidiary of LPL Investment Holdings.