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San Diego County District Attorney

DA Seeks More Victims in Fraud Case

Wednesday, May 10, 2017
Victims

The San Diego DA's Office announced today that there may be more potential victims of three defendants who have been charged with 18 felony crimes including conspiracy, fraudulent sales of a security, theft from an elder adult and employing an artifice or scheme to defraud  investors of millions of dollars. A number of alleged victims in and around San Diego are believed to be members of The Church of Jesus Christ of Latter-day Saints, and there may be additional victims in Orange County and Utah.  

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“Defrauding investors, some of whom are senior citizens, out of their hard-earned savings is reprehensible,” DA Bonnie Dumanis said. “Our Economic Crimes Division is working hard to hold these defendants accountable for their crimes and any additional victims should contact our office.”

Defendants Jacob Keith Cooper, 40, Douglas David Shoemaker, 41, and Nathan Phillip McNamee, 40, are accused of making misrepresentations, omissions and false statements regarding Total Wealth Management, Inc. (TWM), an advisory firm located in San Diego with clients in San Diego, Orange County, Virginia, Hawaii, and possibly Utah. Cooper was the sole owner and Chief Executive Officer of TWM, and employed McNamee and Shoemaker as its Chief Compliance Officers, in which they were all involved in reviewing and preparing investor disclosure documents.

According to documents filed with the U.S. Securities and Exchange Commission (SEC), TWM had approximately $103 million under its management in 773 client accounts, which were investments solicited by Cooper, McNamee and Shoemaker. They defrauded their clients and investors by failing to disclose the conflict of interest created by the receipt of undisclosed revenue-sharing fees, because they placed their clients' money into other unaffiliated funds that paid the respondents significant fees for doing so.  They materially misrepresented to clients the extent of the due diligence that they conducted on the investments they recommended. Finally, they misrepresented the extent to which client objectives would govern investment strategies. The defendants engaged in a pattern of conduct to conceal the revenue-sharing fees they were paid. The monies paid by TWM as consulting fees were the proceeds of the undisclosed revenue-sharing fees.    

The three defendants are expected to appear in court for their preliminary exam readiness hearing on May 15. The DA’s Office is asking any potential victims of this case to call 619-515-8550.

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