The U.S. Securities and Exchange Commission filed a complaint last week accusing a former investment adviser of defrauding Catholic dioceses and clergy in Venezuela out of millions of dollars in a Ponzi-like scheme.
Newsroom (05/06/2025 04:05 , Gaudium Press) The U.S. Securities and Exchange Commission (SEC) has initiated legal action against a former Florida investment adviser in a case that has sent shockwaves through both financial and religious circles. In a detailed 16-page complaint filed May 28 in the U.S. District Court for the Southern District of Florida, regulators allege that Andrew Jacobus, a 62-year-old Fort Lauderdale resident, orchestrated a sophisticated financial fraud (Ponzi Scheme) that specifically targeted vulnerable investors, including multiple Catholic dioceses and clergy members in Venezuela.
The Mechanics of the Alleged Scheme
Court documents reveal that Jacobus operated through two corporate entities – Finser International Corporation and Kronus Financial Corporation – to perpetrate what investigators describe as a classic Ponzi scheme with some unique twists. Beginning as early as May 2015 and continuing through April 2024, Jacobus allegedly solicited approximately $39.7 million from approximately 40 clients, many of whom were elderly Venezuelan nationals facing economic uncertainty in their home country.
The investment vehicle at the center of the allegations was the Corfiser SIMI Fund, which Jacobus rebranded as the Kronus High Yield Fund in 2018. According to the SEC complaint, Jacobus presented these funds as specializing in pre-IPO (initial public offering) investments – a potentially lucrative but highly specialized area of finance that typically requires sophisticated investment expertise. Investigators claim Jacobus promised investors annual returns of 12%, a figure that would significantly outpace conventional market benchmarks.
Targeting the Venezuelan Catholic Community
Perhaps the most disturbing aspect of the case involves the specific targeting of Venezuelan Catholic institutions. While the SEC complaint does not name specific dioceses or clergy members, it reveals that religious investors collectively lost approximately $3.2 million in the alleged scheme. This targeting appears particularly calculated given Venezuela’s well-documented economic crisis, which has seen hyperinflation devastate the value of the bolivar and make U.S. dollar-denominated investments especially attractive.
Robert Warren, a forensic accounting expert and former IRS investigator who specializes in ecclesiastical financial crimes, notes that religious institutions often make tempting targets for fraudsters. “Dioceses and other church entities frequently maintain investment portfolios to fund their operations and ministries,” Warren explains. “In an environment like Venezuela’s economic collapse, the promise of stable dollar-denominated returns can be especially seductive, leading to potentially relaxed due diligence standards.”
The Alleged Misappropriation Scheme
The SEC complaint paints a picture of systematic financial malfeasance. Rather than investing client funds as promised, Jacobus and his companies allegedly diverted at least $17.3 million for improper purposes. These included:
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Personal Enrichment: Approximately $4.1 million in undisclosed salary payments to Jacobus himself, along with substantial sums spent on luxury vehicles, international travel, and high-end real estate acquisitions.
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Ponzi Payments: About $7.8 million was allegedly recycled to earlier investors in classic Ponzi fashion, creating the illusion of profitability while actually using new investor funds to pay purported “returns” to existing clients.
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Direct Theft: The complaint details how Jacobus allegedly gained unauthorized access to client brokerage accounts, moving funds without permission or disclosure.
The Unraveling of the Scheme
By 2021, the operation began showing signs of strain. According to the SEC, Jacobus stopped honoring redemption requests from investors. In early 2022, several clients received suspicious emails – purportedly from an offshore law firm representing Kronus – claiming that all withdrawal requests would be frozen for twelve months. Forensic analysis later revealed these emails to be fraudulent, with the domain registration traced directly back to Jacobus.
The final collapse came in mid-2023 when all communication ceased and payments stopped entirely. This left numerous investors, including the Venezuelan Catholic institutions, with no way to recover their capital.
Regulatory Response and Potential Consequences
The SEC’s enforcement action seeks multiple forms of relief:
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Permanent Injunctions: Barring Jacobus and his companies from future securities violations
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Disgorgement: Requiring the return of all ill-gotten gains plus prejudgment interest
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Civil Penalties: Monetary fines for securities law violations
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Industry Bar: Potentially prohibiting Jacobus from working in the securities industry
Broader Implications and Lessons
This case highlights several critical issues in institutional investing:
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Due Diligence Imperative: Warren emphasizes that religious institutions must implement rigorous investment policies, including working only with established, regulated financial institutions rather than individual advisers making exceptional promises.
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Vulnerability in Crisis: The targeting of Venezuelan investors illustrates how economic instability can create opportunities for financial predators.
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Red Flag Awareness: The promised 12% returns, lack of transparency about fund operations, and eventual communication breakdowns all represent classic warning signs of investment fraud.
As the case progresses through the Florida federal court, it serves as a sobering reminder of the need for vigilance in institutional financial management – particularly for organizations like churches that combine fiduciary responsibilities with their spiritual missions. The outcome may also prompt closer examination of how cross-border investment schemes operate in economically distressed regions.
- Raju Hasmukh with files from The Pillar
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