Ex Dallas Cowboys Player Sued by SEC for Investment Fraud
A former Dallas Cowboys player is being sued by the Security Exchange Commission (SEC) for misleading clients about investments.
Mike Kiselak played for the Dallas Cowboys between 1998 and 1999. According to reports, Kiselak falsely claimed that his Westlake investment fund generated two percent monthly profits by trading treasury bills. 
Kiselak allegedly entrusted the funds to a California-based Venture capital firm, Gemstar Capital Group Inc. The firm and its president, Jeffrey Sykes, have also been named in the SEC suit.
Investors were mostly friends and family members and rather than going into treasury bills, much of the funds went to venture capital investments, including a vineyard. When Kiselak asked for accounts statements, Gemstar provided a false statement that showed about $7 million missing from the funds. According to the SEC suit, Kiselak also failed to disclose to investors that he would charge a 35 percent performance fee. In April this year, he charged investors a performance fee based on Gemstar's supposed 9.6 percent gains during the first quarter of 2009.
Investment Fraud
Investment planners and advisors are required to disclose to investors the risks of their investments. These securities professionals must also make suitable recommendations appropriate for the needs and objectives of the investor.
Failure to disclose is one offense that has been highly visible in recent months. Several investment fraud cases have been linked, in part at least, to the planner's failure to properly present investment techniques and methods to investors. From sub-prime mortgage backed securities schemes that have left thousands of investors with billions dollars losses, to smaller frauds like the one operated by Kiselak, investors have been at the receiving end of the recklessness and greed of their investment planners.
