Not content to be outdone by Hank Mark Werner, the Long Island broker who (*allegedly*) scammed a blind partially deaf widow, Donald Lathen must've said to himself, "You can top this clown, Donny."
The Securities and Exchange Commission accused Donald Lathen with running a scheme where he paid $10,000 to nursing home and hospice patients with less than six months to live to open accounts, bought bonds and notes in the accounts at a discount, and when they died would redeem those securities by representing to the issuers that he was the surviving owner of the account. The alleged fraud centers around so-called survivorship options, also known as “death puts,” which allow bondholders to redeem securities at par plus accrued interest when the holder dies. The SEC says the surviving owner was in fact Mr Lathen’s Eden Arc Capital...Mr Lathen recruited at least 60 people to his scheme, and issuers paid out more than $100m as a result of the scam, the SEC alleged
Naturally, the hedge fund manager's lawyer has come back with the ole: "We have no doubt that Mr Lathen’s investment strategy is entirely legitimate and violates no law."