2012-07-26 / Front Page

Bard Pleads Not Guilty To Alleged Fraud Scheme

Indicted by U.S. for fraud, making false statements
By Lindsay R. Mellott

Robert Bard Robert Bard STAFF WRITER

Robert G. Bard pled not guilty during arraignment proceedings Tuesday to 21 charges of securities fraud, wire fraud, mail fraud, bank fraud and making false statements to the FBI brought against him by the U.S. Department of Justice for allegedly defrauding 43 investors of more than $3 million.

Bard, 45, was arraigned in Harrisburg in U.S. District Court for the Middle District of Pennsylvania at 9 a.m. His not-guilty plea was entered, according to a Department of Justice spokeswoman, by James Wade, a federal public defender.

The 21-count indictment was unsealed last Thursday after Bard’s arrest by a FBI agent at his home near Warfordsburg. He was taken to Harrisburg, where he appeared before a federal magistrate judge and was released on $50,000 unsecured bail.

A federal grand jury handed down the 21-count indictment July 18, charging the former financial advisor, whose clients lived mostly in and around Warfordsburg, with one count of securities fraud, 14 counts of wire fraud, three counts of mail fraud, one count of bank fraud, one count of investment advisor fraud, and one count of making false statements to the FBI.

The Department of Justice alleges that from December 2004 until August 2009 Bard, through his firm Vision Specialist Group, defrauded the investors by misrepresenting and failing to fully disclose the types of investments he made for them and fabricating the performance of their accounts. It accuses Bard of creating false account statements to conceal millions of dollars in losses his clients sustained as a result of risky and speculative investments he made in volatile securities.

The indictment states that Bard “executed and attempted to execute a scheme and artifice to defraud numerous clients of Vision Specialist by soliciting and obtaining millions of dollars under false pretenses, by failing to invest the fraudulently obtained funds as promised, and by repeatedly concealing and covering up the fact that he had squandered their investments on risky stocks ... .”

The indictment also alleges that Bard’s clients were never informed that prior to opening Vision Specialist he had been terminated as a stockbroker after the firm he worked for discovered that he had prepared and submitted investment documents that contained forged customer signatures. Bard also failed to inform his clients that the Financial Industry Regulatory Authority had determined that he forged customer signatures and improperly guaranteed investment returns, or that he had filed a petition for bankruptcy in July 2005 and that he was in bankruptcy court until August 2011 when his personal debts were discharged by order of the bankruptcy court.

The indictment further accuses Bard of repeatedly lying about the value and makeup of investment accounts to approximately 43 clients between July 2006 and August 2009. The false verbal assurances and phony account statements were provided in order to conceal investment losses, to hide investments that went against the clients’ specific wishes, and to generate more fees.

After Bard had misrepresented the makeup and values in his clients’ account, clients suffered more than $2 million in additional losses, the indictment states. During the same time period, Bard is alleged to have made more than $825,000 in client fees from all of his client accounts.

Bard faces a maximum of 75 years in prison if convicted of all 21 counts, plus substantial fines and penalties.

Bard and his firm were charged with securities fraud by the U.S. Securities and Exchange Commission in a civil suit filed July 30, 2009. The U.S. District Court in Harrisburg issued a preliminary injunction against Bard and Vision Specialist on August 11, 2009.

A permanent injunction was issued in November 2011, after the federal court determined that Bard and Vision Specialist had violated securities laws. In February

2012, Bard was found liable for a civil penalty of $2.5 million and $450,000 in disgorgement for profits that resulted from his fraud.

The criminal case against Bard was investigated by the FBI and has been assigned to senior litigation counsel Bruce Brandler, U.S. Department of Justice, Middle District of Pennsylvania, for prosecution.

Bard’s trial is scheduled for October 9, 2012, in Harrisburg.

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