Former Wilmington financial advisor sentenced to prison for $7 million fraud scheme

A former investment advisor in Wilmington is heading to prison for carrying out a $7 million fraud scheme.
Published: May. 24, 2023 at 1:38 PM EDT
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RALEIGH, N.C. (WECT) - A former investment advisor in Wilmington is heading to prison for carrying out a $7 million fraud scheme.

Shawn Edward Good was sentenced to 87 months in prison to be followed by three years of supervised release Wednesday.

He also was ordered to pay $3,619,594 in restitution to his victims.

“This investment advisor was a financial predator who used his position of trust to run a decade-long Ponzi scheme that took in more than $7 million from over a dozen clients,” said U.S. Attorney Michael Easley. “Shawn Good robbed the savings and retirements of clients who trusted him – including a widow, a single mom, and a retired police officer. He did it out of pure greed, to fuel his lavish lifestyle – purchasing luxury cars, exotic vacations and real estate.

“His scheme has finally come to an end thanks to the unshakable courage of the victims and the hard work of law enforcement at the IRS and the SBI. Faced with a choice between right and wrong, Mr. Good chose wrong. Now he will spend the next seven-plus years in federal prison.”

According to court documents and information presented in court, Good executed a scheme to obtain money through an investment fraud commonly known as a Ponzi scheme from 2012 to February 2022, while employed as a registered representative and investment advisor for Morgan Stanley Smith Barney, LLC in Wilmington.

“Specifically, Good solicited investments from business clients and others for purported real estate projects and tax-free municipal bonds, touting these opportunities as low-risk investments that would pay returns of between 6% and 10% over three- or six-month terms,” a news release states. “To effectuate these investments, Good caused some clients to obtain a liquid asset line of credit (LAL) secured by their Morgan Stanley investment or retirement accounts.

“Good directed clients to transfer the LAL funds to their personal bank accounts and then wire the funds directly to Good’s own personal bank account. Other victims paid Good by paper check and wire transfers using funds derived from sources other than Morgan Stanley accounts.”

At least 12 victims invested approximately $7,246,300.

Officials say Good used the money for personal expenditures including his Wilmington residence; a condominium in Florida; luxury vehicles, including a Mercedes Benz, a Porsche Boxster, a Tesla Model 3, an Alpha Romeo Stelvio, and a Lexus RX350; fine dining; and vacations to Paris, France; Cinca Terra, Italy; Jackson, Wyoming; Las Vegas, Nevada; and other destinations.

“To lend credibility to the Ponzi scheme and to elude detection, Good also used a portion of investor funds to make payments to earlier investors,” the new release states.