Shaker Heights Man Sentenced For Defrauding Investor

SHAKER HEIGHTS, OH — A Shaker Heights man has been sentenced to three years in prison for defrauding an investor. James Unger previously pleaded guilty to defrauding an investor out of $287,000.

Unger was a securities broker and investment adviser who provided financial advice to clients. Between 2006 and 2014, he worked on a scheme to defraud an investor that court documents identify only as E.C.

In 2007, E.C. gave Unger power of attorney over her financial affairs. Months later, Unger convinced E.C. to invest in a high-risk international casino project. He assured E.C. that it was a safe, lucrative investment opportunity.

Unger and others gave E.C. promissory notes guaranteeing a 15 percent annual rate of return, court documents said. E.C. invested approximately $407,000 in the project between 2008 and 2009. By 2012, Unger had wired money from E.C.'s bank account, without her knowledge, and given the money to another client. He converted her investment to stock in a new company and convinced E.C. to invest another $79,985, the Department of Justice said.

In 2014, E.C. said she wanted to liquidate her investment in the casino project. She believed her investment, including earnings, totaled $1.9 million. The truth was her actual investment was lost, court documents said.

The DOJ said Unger actually embezzled funds from E.C.'s bank accounts to enrich himself and pay for his own personal expenses, including his daughter's college, court documents said.

Unger pleaded guilty to two counts of wire fraud and five counts of filing false tax returns.

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