David R. Holst, 43, a mortgage broker in Tucson, Ariz., pleased guilty of fraudulently collecting $350,000 from mutual fund investor clients and recklessly, illegally gambling the money, the Arizona Daily Star reports. He accepted the charges of securities fraud and filing a false income tax return.
Holst admitted to setting up a financial advisory business that pretended to invest clients money in mutual funds. Instead, he took the clients money, lost it gambling at a casino, and subsequently doctored statements to make it look like he had created mutual fund accounts for the clients.
Holst, who will be sentenced in federal court on Feb. 12, faces up to 25 years in prison and $1 million in fines. In addition, he could be charged another $250,000 for filing a false income tax return.