12 Worst Financial Advisors in America: 2013

Fraud: Embezzling $4.3 million from trust funds

Rome, managing partner of Rome Associates accounting firm, must have figured that dead men tell no tales. Rome, who was sentenced in August to more than five years in federal prison, for stealing money from trust funds, including the account of someone who had died. He used the money for vacations, cars, boats and jewelry for his family.

Besides the prison term, Rome was ordered to pay $1.7 million in federal taxes that had been skipped. The owners of the trusts got off pretty lucky: they were able to recover the embezzled money from third parties.

6. James Nicholson (Saddle River, N.J.)

Fraud: $100 million hedge fund swindle

(Nicholson is our winner if you going strictly by the amount stolen, but, really, where was the creativity?)

Nicholson, who ran Westgate Capital Fund, is serving 40 years in prison. Like Bernie Madoff's victim's, many of Nicholson's saw their retirement funds vanish. Lawsuits seeking restitution are still open, but there is little hope more of the stolen money will be found. 

5. Richard A. Zakarian (Vermilion, Ohio)

Fraud: $4.4 million, including churches

If there is a special place in the afterlife for those who rip off those who try to help others, Zakarian, a tax consultant, has earned a spot by stealing money from business, charities and even churches. His victims numbered at least 10, according to newnet5.com, which quoted a statement from Steven Dettelbach, U.S. Attorney for the Northern District of Ohio: "This defendant preyed on non-profits, churches and small businesses that struggled to make ends meet while making their communities better. He never meant to help them, only to defraud them. This was a systemic, deliberate pattern of behavior that took place over the years."

Zakarian was sentenced to 17½ years in prison in August after pleading guilty to two counts of wire fraud and one count of making and subscribing false income tax returns.

4. Angelo Alleca (Atlanta)

Fraud: $17 million Ponzi scheme involving a phony cemetery company

There's a certain ick factor in scams involving cemeteries even if no bodies were involved. Alleca created Summit Investment, a fund of funds to attract wealthy investors. The plan worked well for a half a decade, although the underlying scam seems to have been made for Dracula. Alleca collected the cash with the stated intent to put it into other private investment funds to cut the risk for investors. He did it by funneling money to the company of an associate. Detroit Memorial was in the business (or so they said) of bidding on cemetery properties.

Where the money really went is unclear, but the losses piled up, hidden by phony accounting statements. More notes were sold. Then Alleca and his partners created two more funds to get loot to pay back investors from Summit. The long arm of the law caught up with Alleca late last year.

3. Janet Fooshee, aka Janet Gurley-Katz (Morris County, N.J.)

Fraud: $150,000 stolen from retirement center & clients

Fooshee, or whatever her name is, spent a long time stealing a small amount of money. For that, we'll put her at No. 3. She used her advisory firm (which had its registration revoked in 2006) to bilk clients, including a retirement center where she was a volunteer bookkeeper. NJ.com reported that a grand jury indicted her last month on charges involving and creating false account statements to inflate by $1.2 million the amount in the accounts. The crimes occurred over a period of nine years.

Fooshee, who now lives in Maine, faces up to 10 years in prison and $150,000 in fines. He husband was also charged as an accomplice.

2. Gurudeo "Buddy" Persaud (Orlando, Fla.)

Fraud: $1 million astrology-based stock fraud 

Persaud probably should have seen his downfall written in the stars. The former securities broker pleaded guilty last month to defrauding investors by using astrology to play the stock market.

Maybe investors should have been suspicious right from the start. Persaud named his brokerage the White Elephant Trading Co. Persaud was sent to prison for three years and ordered to pay back the money to investors, according to the Orlando Sentinel.

1. Joseph Gennaco (Winthrop, Mass.)

Fraud: $7 million insurance scam, friends

Gennaco earns our top spot for having the temerity to steal from friends and family. Operating under a slew of names, Gennaco persuaded 40 investors, many of them friends and family, to hand over millions from 2001 to 2011 that he promised to invest in "life settlements" and other investments based in insurance. Instead, he used the money to pay for his living expenses in Winthrop and Jupiter, Fla.

Gennaco, according to Boston.com is remorseful. At least his lawyer says so. He probably is feeling bad now that he has been sentenced to more than eight years in prison after pleading guilty to 27 counts of mail and wire fraud in August. He was also ordered to pay restitution, although he is reportedly penniless.

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