SHERMAN, Tex.--A Denison man is convicted for an investment scheme targeting seniors. A Grayson Cunty jury found 72-year old Fred Otto Delin guilty of scamming the elderly by selling investments from a fake company.
He claimed the investments were safer than a savings account and that he received no commission.
In reality, prosecutors say he was investing their money into a fake company, set up by a man on federal parole. Delin reportedly took some of that money for himself. We're told he made about $12 million dollars total, including more than $208,000 in commission.
Prosecutors say Delin did what’s called a “Ponzie scheme.” For example, if one person gave $10,000, Delin kept it for himself. The next $10,000 he received from someone else, he would invest. The money troubles lie when there are no more investors.
Texas State Securities Commission officials say they got wind of the scam, when someone showed them the brochure Delin used to acquire clients. Within five minutes they say they knew it was a scam, and immediately broke up the company. Gerald Rogers, the man who owned the fake company, was sentenced to federal prison until 2015.
Prosecutors say to be on the lookout for similar schemes.
"The best thing to do is number one, don't be hasty and number two, take these materials and these claims to people that will know whether they're legitimate: a tax attorney, a cpa, or the State Securities Commission," said Kerye Ashmore, Asst. Grayson District Attorney.
Securities Commission officials also say if the invitation luncheon has an age restriction, that’s usually a red flag. Officials say scam artists place the restrictions so undercover investigators cannot enter. Usually, most investigators have retired from the profession before they reach the age limits the scam artists place.
District judge Jim Fallon is scheduled to sentence Delin on November 16th. He could face up to life in prison.