RIVERTON, Utah -- The CEO of a $300 million pension fund in Riverton is accused of misusing his customers’ funds for nearly a decade.
The U.S. Securities and Exchange Commission filed a lawsuit against American Pension Services and its owner, Curtis DeYoung, for allegedly taking more than $22 million from clients since 2005.
Since 1982, DeYoung has been running APS, a third-party administrator for retirement accounts that serves approximately 5,500 people around the country.
"It’s a plan that allows you to participate and select the investment of your choice,” said DeYoung, describing his company in a YouTube video posted under his name.
It's a far different picture of his business than the one that’s been painted by the SEC in their lawsuit, accusing DeYoung of making unauthorized high-risk investments, forging letters and wire transfers and inflating asset values.
FOX13 tried to reach DeYoung at his home in Draper, but received no response. Many of his clients made similar attempts throughout Tuesday afternoon.
“Just to see how he might have been spending the money,” said Dave Lewis, who set up a self-directed individual retirement arrangement (IRA) with the company about 10 years ago.
Once the lawsuit was filed last week, Lewis received an email notifying him that all of APS assets had been frozen to protect the money, pending investigation.
“Seemed like a good company,” Lewis said. “They’ve been good, up until this point.”
According to court documents, DeYoung primarily misused his clients’ cash for his own ventures and for the ventures of his friends.
In one example, court records indicate DeYoung convinced numerous APS customers to hold promissory notes with a friend, “Friend A.”
“In addition to individual investments made by APS customers, DeYoung directly invested APS funds with Friend A or his entities without disclosing to customers this use of customer funds,” the document reads.
Investigators later found that those investments never generated a profit, according to the lawsuit.
“Half of the people’s cash, or a third of people’s cash, may be gone,” said Salt Lake City attorney, Wayne Klein.
Currently, Klein is the court-appointed receiver in another federal fraud investigation of a Utah investment company, which shared customers with APS.
“It surprises me that a violation, which is so clear cut, would occur and apparently had been occurring for some time and to such magnitude,” Klein said. “This is a company that exists because of its obligation to hold customer monies in trust.”
According to court documents, when questioned about the missing money, DeYoung invoked his 5th Amendment privileges to avoid self-incrimination.
Customers have been told that the next court hearing on this case is scheduled for early May, at which point they are expected to learn more about what access they may have to their money.
“Hopefully, I haven’t lost any,” Lewis said.