Money Advisor Investigated for Alleged Scam

A financial advisor is under investigation for allegedly bilking tens of thousands of dollars from dozens of elderly people as part of a massive investment scam involving certificates of deposit, authorities said Tuesday.

Vincent Ferro, 42, allegedly received large commissions from at least 85 seniors in Ventura and Los Angeles counties whom authorities said invested more than $10 million through Ferro’s Thousand Oaks firm, Capital Advisory Group. Some of the investors include Ferro’s family, a relative said.

“For many of these people, this was their retirement savings and they lost it,” said Deputy Dist. Atty. Tom Johnson.

Investigators from the Sheriff’s Department, the district attorney’s office, Federal Bureau of Investigation, state attorney general and Department of Corporations are investigating Ferro on allegations of grand theft, forgery and securities fraud. He has not been arrested or charged with any crime.

Sheriff’s investigators said Ferro’s brokerage firm ran newspaper advertisements offering one-year certificates of deposit that paid monthly dividends between 7% and 12%.

Investors were told the company charged no commission on the invested money but instead made its money from referrals to other financial institutions, Det. Dan Place said.

Investors were told they could withdraw their money without penalty, when they actually incurred large penalties.

Instead of investing in one-year CDs, authorities said, Ferro pooled the money from investors into 20- or 30-year “Jumbo CDs.”

From those investments, authorities said, Ferro received 15% to 45% commissions from investments that often totaled more than $100,000.

Authorities don’t know the total amount in commissions because they are still investigating potential victims for investments that may go back as far as 1995, authorities and investors said.

Some investors may not know they lost money, authorities said.

In early July, several investors contacted police after receiving monthly statements with balances far below their initial investments. Ferro sent several investors who complained checks that later bounced, authorities said.

Ferro has since closed his business, left Thousand Oaks and been unavailable to investors. Neither he nor his attorney could be reached for comment Tuesday, but several investors who were contacted said he remains in Ventura County and that authorities know where he is.

Investors, some of whom have recently told their stories on national television news shows, are outraged.

“Of the investors I know, 27 of them put in $5.5 million dollars, so my guess is that Vincent could have gotten as much as 30 or 40%,” said Bill Flartey, a Camarillo resident who said he invested several hundred thousand dollars.

Edward Feten, a 37-year-old Camarillo engineer, said he’s known Ferro for about 20 years and trusted him. So when Ferro telephoned Feten’s mother in 1995 to tell her about his investment company, Feten not only encouraged her to invest more than $100,000 but invested $40,000 of his own money.

When Feten tried to cash out his investments early last year he learned the money was in 20-year CDs, which he said he didn’t know up front.

Eventually Feten got $25,000 back, but he lost $15,000 when the company closed in early July. His 69-year-old mother--whose money wound up in 30-year CDs--has gotten virtually nothing back, he said.

Marian Abrams, 84, of Sherman Oaks said she began investing with Ferro’s company in early 1999 and has lost more than $100,000--most of her retirement savings.

“I’m just so aggravated with myself,” Abrams said.

Abrams said she was disappointed with her low returns on traditional CDs and contacted Ferro after seeing one of his ads. A company representative came to her home to explain the program, emphasizing she could withdraw her money in a year.

When she tried to get her money, Abrams said, Ferro put her off. She eventually learned the money was in long-term CDs.

Abrams said she had saved her money to avoid the situation she’s in now, “so of course it’s a terrible thing and a terrible feeling.”

Representatives from Advent Trust Co., the Houston-based firm that Ferro used to purchase the CDs from 131 banks throughout the country, have met with several investors and tried to help them get their money back.

So far, 40 banks have responded to investors and said they will not allow them to liquidate their securities without penalty, Place said.

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Wolcott is a Times Community News reporter, and Talev is a Times staff writer.