Blazer pays $1.9 million to end charges of defrauding clients, including some professional athletes.
The Securities and Exchange Commission (SEC) had filed a complaint alleging that, between 2010-2012, Louis Martin “Marty” Blazer III embezzled funds from five clients, including at least two professional athletes, and then replaced the funds by using a “Ponzi-like scheme.” They estimated he made unauthorized use of $2.35 million of clientele money, using some to invest in movies that were being shot locally in Pittsburg.
In the complaint, the SEC alleges that Blazer had tried to convince an unidentified professional athlete to invest in a movie project. When the athlete refused, Blazer forged documents to make it appear as if the athlete had approved six (6) investments in 2010. In 2012, when the athlete noticed the unauthorized transfers, he demanded the money back. This is when Blazer removed money from another client’s account to repay the athlete.
In 2016, the SEC and Louis Martin “Marty” Blazer III came to an agreement to settle allegations that he had defrauded former clients.
Yesterday, a New York federal judge said that Blazer will pay $1.9 million to end the charges that were brought against him by the SEC. Blazer is making this payment without admitting or denying the allegations against him.
This is not the first time that Blazer has had allegations brought against him. In 2011, a former NFL player and University of Pittsburg standout, Kevin Bacon, alleged that Blazer refused to disclose his full financial statements and hid $13-$15 million of his own money from him.
Bacon’s original complaint asked for over $4 million in compensatory damages (damages that actually occurred in the event) and punitive damages of over $12 million (damages that are added on in order to deter similar actions from occurring at a later time, only awarded at the court’s discretion).
Bacon and Blazer settled this case out of court in 2012.