Loren Holzhueter Allegedly Ran Multimillion Dollar Rural Wisconsin Ponzi Scheme

Investment fraud lawyersSince 2008, Loren Holzhueter, 69, and of rural the rural Wisconsin communities of Oconomowoc and Watertown, has allegedly been running a multimillion dollar Ponzi scheme, according to a new federal complaint from the Securities and Exchange Commission (SEC).

The SEC complaint further alleges that from January 2008 through November 2014, Holzhueter, who has worked for 30 years as a tax preparer and insurance broker, reportedly raised at least $10.4 million from at least 122 investors. The SEC describes how Holzhueter and his insurance brokerage allegedly lied to investors about the location of their funds, and then misappropriated those funds to pay other investors or business expenses.

Holzhueter Reportedly Used Local Farming and Church Connections after Bank Loans Expanded Too Far

Holzhueter was skilled at generating business amongst the local farming community in the greater Watertown area, and even he attended the same church as some of his clients, the SEC reports. When he purchased Insurance Service Center Inc.(ISC) in 2004, he was reportedly pushed beyond his means.

The federal complaint alleges that ISC had a negative cash balance of $432,896.97, and this is when Holzhueter allegedly began to solicit investments from individuals.  Investors were reportedly told that they were investing in the business’s expansion, while others simply believed their money was being placed in liquid investment accounts, according to SEC claims.

Instead, Holzhueter reportedly deposited investor funds straight into ISC’s general accounts, where they comingled with other revenue, the federal complaint states. In addition, Holzhueter allegedly used the funds for the business’s operations such as paying off bank debt and covering a legal settlement, regulators note. Finally, Holzhueter also allegedly used his other company, Honefi Inc., a relief defendant, as a money source, sometimes forwarding investments from ISC to its accounts, the complaint also reports.

Investment Recovery Lawyers Investigating

The Peiffer Wolf investment recovery lawyers often represent investors who lose money as a result of investment misrepresentation and Ponzi schemes. They take most cases of this type on a contingency fee basis and advance the case costs, and only get paid for their fees and costs out of money they recover for their clients.

Investors who believe they lost money as a result of investment misconduct or Ponzi schemes may contact the investment rights lawyers at Peiffer Wolf, Jason Kane or Joe Peiffer, for a free, no-obligation evaluation of their recovery options, at 585-310-5140.

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