For Immediate Release - October 22, 2009

Attorney General Martha Coakley's Office Announce Guilty Plea and Sentence of a Former Financial Advisor Charged with Securities Fraud and Larceny

BROCKTON - Today, a Hull man pled guilty in Plymouth Superior Court in connection with a 10-month long larceny and securities fraud scheme, in which he represented himself as a financial planner and stock broker, and stole money from a neighbor who entrusted him to invest more than $187,000. Jeffrey Gruber, age 46, pled guilty after jury empanelment to charges of Larceny over $250 (5 counts) and Securities Fraud. Immediately after the plea was entered, Superior Court Judge Jeffrey A. Locke sentenced Gruber to serve four years, three months to seven years in State Prison on the charge of Securities Fraud. On three counts of Larceny over $250, Judge Locke sentenced Gruber to suspended House of Correction sentences. On the remaining two counts of Larceny over $250, Judge Locke sentenced Gruber to 10 years probation. Gruber must also pay restitution in the amount of $120,000 to the victim. While on probation, Gruber must seek to maintain full-time employment; cannot be employed in any position in which he is entrusted to handle other people's money; and must have no contact with the victim. In connection with a civil suit brought by the victim, $59,000 was seized from Gruber's accounts in 2006.

Gruber has twice previously been charged with and convicted of similar charges in connection with investment fraud. The present case arose in July 2006 after the Attorney General's Office received a copy of a complaint against Gruber filed by the Secretary of the Commonwealth's Securities Division. The complaint stated that from mid-October 2005 through late March 2006, Gruber misrepresented himself to the victim as a certified financial planner and stockbroker. Gruber advised the victim to invest funds in certain bonds and stocks, and in a real estate loan. He deposited the money into accounts in the name of Gruber Financial Services, Inc., a defunct corporation. Gruber did not invest the victim's funds, but instead spent the funds for his personal use. The victim and her lawyer contacted the Secretary of the Commonwealth's Securities Division after Gruber failed to comply with the victim's demand for an accounting of her investments and the return of her money.

A Plymouth County Grand Jury returned indictments against Gruber on January 4, 2008. On March 12, 2008, Gruber was arrested in Hull by Massachusetts State Police assigned to the Attorney General's Office. He was arraigned the same day in Brockton Superior Court where he pled not guilty and was ordered held on $500,000 cash bail. Yesterday, a jury for Gruber's trial was seated. Today, before the start of his trial, Gruber pled guilty to all charges and was sentenced.

The case was prosecuted by Assistant Attorneys General Marc Jones and Margaret Parks, both of Attorney General Coakley's Corruption and Fraud Division. It was investigated by Paul Stewart, chief of the Attorney General's Financial Investigations Division, and Mark Pulli, also of the Financial Investigations Division.