The Securities and Exchange Commission says it has charged an investment advisor barred three decades ago with stealing close to $2 million through an alleged Ponzi scheme.

Beginning around February 2019, David Schamens allegedly solicited investors’ money for TradeStream Algo Fund, purportedly an investment vehicle that would auto-trade pre-selected equities using a proprietary algorithm, according to a complaint the regulator filed in the U.S. District Court for the District of New Jersey.

But Schamens allegedly never invested any of the funds raised, using investors’ money instead to cover personal expenses and make Ponzi-like payments to earlier investors, the SEC says.

To hide his alleged scheme, according to the regulator, Schamens provided investors with bogus account statements and a fake letter from an auditing firm.

The SEC says that Schamens stole at least $1.8 million from his clients.

Schamens was able to pull off the alleged fraud despite being barred by the SEC in 1992 following a settlement over allegations including misappropriating investor funds, according to the regulator.

Schamens is also facing criminal charges in a parallel action brought by the U.S. Attorney’s Office for the District of New Jersey.

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