GULFPORT -- A federal grand jury has charged an Ocean Springs retirement investor in a six-count indictment, accusing him of borrowing from investors and converting more than $1 million for his own use.
Records in U.S. District Court say Eduardo "Eddie" Guillermo Diaz made fraudulent statements about potential investments to entice clients to give him large amounts of their own money that he later used illegally.
Diaz used some of his clients' money to "enrich" himself, court papers say, while other clients' money was used to cover the costs of other investor dividends or to refund or repay previous investors in an attempt to cover up a scheme to defraud the clients.
Diaz would "deceive or lull his clients into believing" their funds had been properly invested when they had actually been used by him or to pay up on other accounts to cover up what he was doing, records show.
The grand jury indicted Diaz on four counts of investor fraud and two counts of wire fraud.
The wire fraud centers around check payments, all of which allegedly were written for thousands of dollars, from bank accounts in Kentucky, Florida, Arizona and Virginia for deposit into various accounts in Mississippi.
The indictment says Diaz consistently deceived clients who had relied on him to make sound and secure retirement investments for them.
The crimes allegedly occurred in Jackson and Harrison counties at different times between February 2012 and the date of Oct. 6 indictment. The indictment says others helped Diaz in his scheme.
Diaz pleaded not guilty Thursday. He is free on an unsecured $25,000 bond.
He is set for trial on a court calendar that starts Dec. 7.
Over the years, Diaz made a name for himself in local television ads that referred to him as the "most interested man on the Coast."
In one segment, Diaz says: "In life, it's more important to be interested than to be interesting. I'm interested in helping you retire, retire, retire."
Barred from securities industry
Diaz is no longer a registered broker, according to FINRA BrokerCheck Records.
The Financial Industry Regulatory Authority permanently barred Diaz from the securities industry in a settlement agreement in April 2014.
Diaz did not admit or deny allegations related to a complaint from an Ocean Springs woman that sparked the inquiry. The client accused Diaz of borrowing money from her and converting money to his own use.
According to the complaint, Diaz befriended the victim prior to her husband's death. At her husband's wake, Diaz approached the widow to tell her he'd start taking care of her finances for her. He set up a non-brokerage account for the woman and told her to deposit the insurance money from her husband's death into that account.
The FINRA report says Diaz convinced the woman to invest in a company he said he controlled that included five rental properties. Her investment was to be used to remodel and refinance the properties, FINRA said, but Diaz did not own any properties or have any rental properties.
The amount of investments and loans involving the woman totaled at least $365,000.
FINRA determined Diaz made false statements to the woman to solicit $87,000 in loans from her. Diaz, the report said, would withdraw money from the customer's account at the firm he worked for at the time and transfer the money to the woman's personal bank account. He asked her to wire the same funds as well as any loan from her to his personal bank account. The personal bank account Diaz set up contained almost entirely the victim's funds.
Diaz later repaid her loan using the money he generated from selling securities out of the woman's brokerage account without her knowledge, reportedly using her own money to pay her back.
Diaz was a registered investor from February 1987 until January 20, 2013, the FINRA report said. He was registered with American Express Financial Advisors in Minneapolis, Minn., Sunamerica Securities in Phoenix, Ariz., AIG Financial Advisors in Biloxi, Next Financial Group Inc. in Biloxi, and most recently, with Kovack Securities Inc. in Fort Lauderdale, Fla.
According to his company profile, he moved to Ocean Springs in 1987 and helped open the investment retirement firm of Thompson, Diaz, Baxter & Associates in 1993. He said he opened Diaz Retirement Consultants in Ocean Springs in October 2012.
His broker report shows he has had at least two customers complaints.