Unregistered Investment Advisor Sentenced for Felony Theft

Attorney General Douglas F. Gansler today announced that Joseph Alphonso Engerman, 40, formerly of King Frederick Way in Upper Marlboro, was sentenced in the Prince George’s County Circuit Court to one year in jail on his conviction of felony theft. Judge Sheila Tillerson sentenced Engerman to five years incarceration with all but one year suspended, five years supervised probation, and ordered him to pay a total of $89,622 in restitution to his three victims.

After losing his status as a lawfully registered investment advisor in 1998, between February, 1999, and May, 2001, Engerman expressly misrepresented himself to prospective investors as a registered investment advisor and an owner of “Engerman Investment Center.” The three investors victimized in this case relied on his fraudulent misrepresentations and trusted Engerman to invest their money wisely.

The defendant came to his first victim’s Prince George’s County home and obtained a check for $18,000 made payable to his “Engerman Investment Center.” Later, the victim unwittingly invested an additional $1,772 with the defendant’s bogus investment firm. Engerman stole $9,772 and lost the rest to risky margin trading. Engerman’s second victim invested a total of $221,241. Engerman improperly invested most of this money and converted $64,850 of it for his personal use. His third victim, whom he met though a mutual friend, relied upon his promise to follow a conservative investment strategy when she gave him a total of $27,000. Instead, Engerman stole $15,000 and lost the rest in margin trading not authorized by the victim.

Engerman used the money that he stole from each of his victims for personal gain and to pay back other investors, thereby maintaining the pretense of his “Engerman Investment Center.”

This case was investigated and prosecuted by the Criminal Division of the Attorney General’s Office. The case was referred for criminal investigation by the Attorney General’s Securities Division. In making today’s announcement, Attorney General Gansler thanked Assistant Attorney General Kate O’Donnell for her work on the case.