UPDATE: Thomas Laws Civil Suit for FRAUD VICTIMS
Attorney David Neuman Is Quoted Regarding Claims Against Thomas Laws’ Former Brokerage Firm, HD Vest
Attorney David Neuman was quoted extensively in the Silver City Daily Press, regarding Silver City financial advisor Thomas Laws, who was arrested in August 2019. The November 2019 article was written by Geoffrey Plant, a Silver City Daily Press reporter, and referenced Attorney David Neuman, who represents a number of Thomas Laws victims. Since the article was written, the Law Firm of Israels & Neuman has filed two more claims against HD Vest (now Avantax) on behalf of about 20 investors.
A link to the article can be found here: http://www.scdailypress.com/site/2019/11/02/fraud-victims-prep-civil-suit-against-investment-company/
The article states:
Fraud victims prep civil suit against investment company
Written by Geoffrey Plant on November 2, 2019
Silver City CPA and former investment broker Thomas Laws’ former employer is being pursued in separate civil matters by a variety of attorneys, representing some of Laws’ former clients and businesses which may be victims of Laws’ alleged malfeasance.
Thomas Laws was arrested by the FBI at his office on Hudson Street in late August on three felony charges related to his alleged theft of more than a million dollars from a local elderly couple over the years 2014-18.
After his arrest, Laws entered a plea of not guilty to the charges — wire fraud; transportation, transmission and transfer of money stolen, converted and taken by fraud; and aggravated identity theft — in the federal case, which was reassigned in September to U.S. District Judge Kenneth J. Gonzales. The case will be heard in federal district court in Las Cruces.
Earlier this year, Laws was barred by the Financial Industry Regulatory Authority from working as an investment broker, and was also subject to at least one summary judgment in a 2018 foreclosure case in New Mexico District Court that involves the same real estate company, XYZ Ranch Estates, LLC, named in the federal criminal case.
Court documents show that multiple properties owned by Laws or by companies controlled by Laws were the subjects of foreclosure proceedings, including the office of his CPA firm at 909 N. Hudson St.
In July, Laws declared bankruptcy, and his remaining assets are frozen under the terms of his pretrial release.
David Richter is a lawyer with Business Law Southwest, an Albuquerque-based law firm that represents the two victims at the heart of the federal criminal case against Laws. That couple is hoping to recoup some of their life savings by suing the national investment firm for which Laws worked as a registered agent from 2006-17.
“He’s done a lot of damage to people,” Richter said. “It’s difficult to overstate just how much chaos, stress and uncertainty that he caused people.”
Business Law Southwest is partnered with Israels & Neuman, an out-of-state law firm with offices in Denver and Seattle that specializes in securities fraud. Attorney David Neuman said there is unlikely to be anything left to recoup from Laws, whether or not he is convicted in federal court.
“Our main target is not Mr. Laws,” Neuman told the Daily Press by phone from Seattle. “What he does have is frozen by the Feds. Most of these cases, there isn’t enough to pay victims; our goal is to make his victims as whole as possible. If they can gather money through the criminal case — getting 7 cents on the dollar is average with cases like this.
“I think there is a high probability that Laws will be convicted,” Neuman added. “When the Feds bring a case like this, the conviction rate is pretty high.”
Because Laws was a registered representative for H.D. Vest, LLC, which rebranded itself as Avantax Wealth Management in September, Neuman and Richter are planning to file a complaint, and, at the same time, request arbitration proceedings with the company on behalf of at least four former clients of Laws.
“We’re talking with another half-dozen people,” who may have been defrauded, he said. “There’s a lot of different things going on that aren’t necessarily all connected.”
But because H.D. Vest was technically supposed to be supervising Laws, Neuman maintains that any misconduct should have been revealed in audits by the company.
“This was going on for 10 to 15 years, it looks like,” Neuman said.
The large, deep-pocketed, investment company may be the only source of satisfaction for those who invested in companies controlled by Laws, and who say they never got their money back. Over the past few decades, Laws was the registered agent for a dozens of companies, including Laws and Company, the Laws Corporation, Oro y Plata and Outlaw Hideaway Ranch, LLC — which, in itself, isn’t necessarily unusual for a broker and CPA. However, he was allegedly moving money between company and personal business accounts — and forging documents to cover it up — for years.
“For example, some invested in Simple Logic Systems, Santa Fe Gold, THL [Thomas H. Laws Financial Services Corporation], or in real estate deals, and never got anything back,” Neuman said. “It’s got to be millions of dollars, based on the people we’ve talked to.”
Nearly all of the alleged victims are from the Silver City area, Neuman confirmed.
“Our goal is to get a complaint filed in the next few weeks,” Richter said.
Meanwhile, in the criminal case against him, Laws was assigned an additional attorney, assistant federal public defender Daniel Noah Rubin, and was also granted a continuance that will push his trial date into next year. He was originally set for trial this month.
“There is voluminous discovery,” wrote Darcy Blue Riley, Laws’ other assigned assistant federal public defender, in the motion, which was not opposed by prosecuting U.S. Attorney Timothy Vasquez. “Further, the government has notified defense counsel that more [evidence] may be forthcoming,” and Laws’ legal team will need time to review it.
Gonzales agreed to the request, and ordered that the date for a jury trial not be set until February. Laws remains out on bond, and has been assigned a pretrial supervision officer.