Adam Kaplan Sentenced After Federal Fraud Verdict

Introduction

Today, a federal jury delivered a decisive verdict in a case that exposes a profound breach of trust at the heart of the financial advisory profession. Adam Kaplan, alongside his twin brother Daniel, now stands convicted for masterminding a ruthless, multi-year scheme that systematically stole millions of dollars from the very clients who depended on them for financial security. The conviction is not merely for fraud; it is a condemnation of a pattern of calculated predation that specifically targeted elderly, disabled, and vulnerable individuals, betraying the foundational duty of a fiduciary. Furthermore, the jury found that Adam Kaplan, when confronted by the law, engaged in an even more dangerous series of crimes aimed at intimidating victims, bribing officials, and derailing the pursuit of justice itself. This case, prosecuted by the United States Attorney’s Office for the Eastern District of New York, closes a major chapter of deception while opening another focused on the severe consequences that await those who view client trust as a currency to be stolen.

The Conviction and Its Weight

After an eight-week trial in Central Islip, a unanimous jury found Adam Kaplan and Daniel Kaplan guilty on a sweeping array of felony charges. The convictions include conspiracy to commit wire fraud, substantive wire fraud, investment advisor fraud, and money laundering conspiracy. For Adam Kaplan, the jury delivered an even more severe judgment, finding him guilty on additional counts including a separate bank and wire fraud conspiracy and, critically, attempted obstruction of justice. This last charge relates to his conduct while free on a multi-million dollar bond after his initial arrest. The verdict validates the years of work by federal prosecutors and FBI agents to unravel a complex web of lies. In announcing the result, the United States Attorney stated the brothers now stand convicted as “ruthless thieves” who betrayed their clients, while Adam Kaplan faces particularly serious consequences for his attempts to “undermine the criminal justice process.” The convictions transform allegations into established legal fact, setting the stage for sentencing where the brothers face the potential of decades in federal prison.

The Core Fraud: A Scheme Built on Blank Contracts and Forged Trust

At the heart of the decade-long fraud was a simple yet devastating trick played on approximately one hundred victims. While working as investment advisors at IHT Wealth Management, the Kaplan brothers would promise clients, many of whom were elderly or mentally disabled, that their annual advisory fee would be around one percent. They then presented clients with contracts for signature. Crucially, the fee percentage line on those contracts was left blank. Relying on the brothers’ verbal promises and their position of trust, victims signed the incomplete documents. The Kaplans would later fill in exorbitant fee percentages—sometimes more than four times the promised rate—and proceed to withdraw those inflated amounts from client accounts. This method allowed them to steal at least ten million dollars, which they used to fund luxury personal expenses. The scheme was a gross violation of the fiduciary duty that requires advisors to act with utmost good faith and full disclosure, instead weaponizing client vulnerability for personal greed.

Advanced Deception: Unauthorized Withdrawals and Fake Services

The fraud extended far beyond inflated fees into outright theft and fabrication. The brothers devised a method to siphon money directly from clients’ personal bank accounts without authorization. To hide these thefts, they would first transfer money from the victim’s own investment brokerage account into their linked bank account. They would then immediately debit an identical sum from that bank account for themselves. This manipulation made the bank account balance appear unchanged on statements, delaying detection. When clients or institutions began to question the unusual activity, the Kaplans engaged in a cover-up that included forging client signatures on documents and lying to financial institutions. Prosecutors recovered over a dozen completely fabricated contracts for services like “life coaching” or “divorce consultation” that were never provided, created solely to justify illegitimate charges and launder the stolen funds.

Predation on the Most Vulnerable: Elderly and Disabled Victims

The trial evidence painted a particularly disturbing picture of the brothers’ targets and tactics. They systematically preyed upon individuals rendered vulnerable by age or illness. In one instance, they took out a loan in the name of an elderly woman while she was caring for her dying husband, stole the loan proceeds, and left her responsible for the debt. They stole from a family in Arizona that included a 100-year-old grandmother, tricking them into sending checks that Daniel Kaplan then altered and deposited into his own account. Even after being fired by IHT Wealth Management in July 2021 for their fraud, the predation continued. Adam Kaplan separately befriended a woman suffering from dementia who could no longer recognize her own husband. He escorted her to a Manhattan bank to have her sign documents that enabled him to steal hundreds of thousands of dollars more from her. These acts demonstrate a chilling focus on victims perceived as less likely or able to report the crimes.

The Obstruction of Justice: Threats, Bribes, and Intimidation

Faced with a federal grand jury investigation, Adam Kaplan embarked on a separate, criminal campaign to obstruct justice. Between April 2023 and September 2024, he paid a co-conspirator over $75,000 to tamper with, threaten, and violently assault victims of his fraud scheme. Using a burner phone, Kaplan communicated in terrifying detail. He texted that a victim needed “to fear” and that another should be left “peeing blood / missing teeth.” He ordered his associate to send victims text messages adorned with skull-and-crossbones imagery to intimidate them. In a direct attack on the prosecution, he tasked the co-conspirator with digging up compromising information on a federal prosecutor to use for blackmail. Shockingly, even after his arrest and while released on a multi-million dollar bond, Kaplan continued these efforts, attempting to orchestrate bribes to Department of Justice officials. This sustained effort to subvert the legal system led to the additional obstruction conviction and will heavily influence his eventual sentence.

Risk Assessment: The Profile of a Predatory Insider

The convicted actions of Adam Kaplan establish an extreme risk profile for any financial system. The case is a paradigm of insider fraud, where the trusted position of an advisor is exploited as the primary weapon. Key red flags demonstrated include: specifically targeting vulnerable demographics (elderly, disabled); utilizing documentary deception (blank contracts, forgeries); employing transaction layering to conceal theft (the transfer-then-debit method); and showing a willingness to escalate to violence and corruption when exposed. For financial institutions, this underscores the catastrophic importance of robust controls over fee authorization and changes, especially for accounts held by vulnerable adults. The reputational damage is severe and extends to the employing firm, IHT Wealth Management, which must answer for its supervision lapses, and to the broader advisory industry, which suffers a collective erosion of public trust. The legal and compliance failure is total, demonstrating how weak internal oversight can allow a decade of predation to proceed undetected.

Conclusion:

The conviction of Adam Kaplan represents a critical victory for justice but also serves as a stark warning about the potential for predation within regulated professions. The jury’s verdict confirms that his actions went far beyond aggressive business practice into the realm of systematic criminal exploitation and a direct assault on the judicial process. This case exposes critical vulnerabilities in how financial advisors are supervised and how easily fiduciary duty can be violated when greed overrides ethics. For regulators and firms, the lessons are clear: enhanced monitoring of fee structures, mandatory verification of client instructions—particularly for vulnerable persons—and robust whistleblower protections are not optional. For the public, it is a sobering reminder that credentials and employment at a reputable firm are not absolute guarantees of integrity. While the sentencing will bring a measure of closure, the profound harm inflicted on elderly and disabled victims, whose financial security and trust were shattered, remains the most enduring tragedy of this calculated scheme. The path to restoring confidence demands relentless vigilance and an unwavering commitment to placing client protection above all else.

Written by

Barney Stinson

Updated

8 seconds ago