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Feds alleges Watertown insurance agent ran $10M Ponzi scheme

Posted January 28, 2015 10:00 pm

The Associated Press

MILWAUKEE (AP) - The U.S. Securities and Exchange Commission is alleging a Watertown insurance agent ran a $10 million Ponzi scheme out of his agency.

The SEC filed a securities fraud lawsuit this week against 69-year-old Loren Holzhueter and one of his companies. A federal judge froze Holzhueter's assets in response.

The lawsuit alleges at least 122 investors were told "a wide array of lies" by Holzhueter.

The SEC says Holzhueter told some investors their funds would be kept in a special investment account at ISC Inc., an insurance brokerage he owns. The SEC alleges that investor funds were intermingled with other ISC revenue.

Holzhueter's attorney, Stephen Kravit, tells the Milwaukee Journal Sentinel (http://bit.ly/1uGMApT) the money given to Holzhueter were loans and not investments. Kravit denies that Holzhueter was running a Ponzi scheme.

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Information from: Milwaukee Journal Sentinel, http://www.jsonline.com

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