MANHATTAN (CN) – A woman who says she lost $860,000 in a Ponzi scheme filed a class action against Fiserv Trust Co., and TD Ameritrade Online Holding Corp., claiming they acted as custodians for accounts that “existed on paper only.”
Shelley Anderson says she held about $860,000 in Fiserv pension and IRA accounts and “had no idea” that the assets “had been stolen and depleted,” until she heard about the arrest of Edward Stein.
On March 31 the SEC accused Stein of running a “classic Ponzi scheme,” moving more than $55 million through his affiliated companies, including DISP LLC, Edward T Stein Associates, G & C Partnership Joint Venture, Gemini Fund, Prima Capital Management, and Vibrant Capital Corp.
The next day, according to the complaint, a district court judge granted the SEC’s request to freeze Stein’s assets.
Anderson claims that Fiserv never told her “that it was turning actual custody of her assets over to Stein and the affiliates.” She says the company sent her fictitious statements making her believe “that it held custody and that her assets were safe and secure.” They even charged her for purportedly holding the funds that they actually transferred to Stein, she says.
“Since the Custodians did not hold customer assets or value such assets, they were paid for doing virtually no work of any kind,” the complaint adds.
Anticipating legal trouble, Fiserv had clients agree to “broad indemnity claims … to relieve itself of any possible liability for misconduct by Stein and/or the Affiliates,” according to the complaint. Anderson’s attorneys say such provisions are unconscionable.
She demands damages for breach of fiduciary duty, breach of contract, negligence, conversion and violation of general business law on behalf of herself and all customers who had pensions and IRAs in Fiserv accounts.
(In 2008, Fiserv sold its subsidiary FTC to TD Online, a subsidiary of TD Holdings.)
Anderson is represented in New York County Court by Kenneth Elan with Bernard Gross PC.