2017
Lawrence Allen DeShetler, an investment adviser in The Woodlands, was sentenced to five years in federal prison on Nov. 1 after pleading guilty in June to federal mail fraud charges.
DeShetler convinced five clients – two of whom were in their 80s – to cash out legitimate investments and transfer the money to him so he could get them higher returns.
DeShetler instead deposited the money into bank accounts over which he had sole authority, defrauding the clients of $1.9 million – and ultimately landing himself in prison. On Nov. 2, U.S. District Judge Marcia A. Crone of the Eastern District of Texas sentenced DeShetler to 60 months in prison and ordered him to pay restitution of $948,058.
Investors received some of their money back before the order of restitution. Local and federal law enforcement authorities seized DeShetler’s bank accounts and took other steps to return approximately $857,000 to investors.
DeShetler’s clients were mostly invested in mainstream financial products like stocks, mutual funds, annuities, and insurance policies. The clients, however, bought DeShetler’s pitch that he could make them more money if he controlled the funds.
DeShetler convinced an 83-year-old client to liquidate an existing trust account and transfer $187,699 to himself. The woman’s husband had died in 2015, and in May 2016 she allowed DeShetler to stay at her home while she visited her son. When she returned six weeks later, all her investment documents were missing. DeShetler was gone as well.
Another client, aged 64, cashed out her individual retirement account (IRA) and sent DeShetler a check for $726,985. DeShetler told her he would deposit it in a new IRA. Instead, he deposited the full amount into a bank account over which he had sole authority. DeShetler did the same thing with money he received from four other clients.
DeShetler used investor funds to make a down payment to begin construction on a house in Nicaragua, where he spent part of 2016. DeShetler never saw his house completed, however. He returned to Texas in mid-2016 after local law enforcement authorities seized his bank accounts.