NASHVILLE, Tenn. - May 7, 2019 – Jay Costa Kelter, 49, of
Alpharetta, Georgia pleaded guilty today in U.S. District Court, to wire fraud
and securities fraud, announced U.S. Attorney Don Cochran for the Middle
District of Tennessee.
According documents filed with the court, between March 2014
and August 2016, Kelter embezzled over $1.4 million from an elderly client who
lives in Brentwood, Tennessee. As part
of his scheme, Kelter convinced the victim to move her investments from a
private investment company to a discount brokerage firm. Kelter used his access
to the woman’s accounts to periodically sell securities held in those accounts
to pay for transfers to his own pass-through company. On one occasion, Kelter
impersonated the victim while confirming a trade in her accounts.
Kelter did not divulge ownership of the pass through company
when confronted by the victim, but later admitted that he directed the
withdrawals from the accounts to his company. Kelter used portions of the
stolen funds to purchase luxury cars, custom jewelry, and vacations, and to
repay losses owed to other investment clients.
Kelter faces a maximum sentence of 20 years in prison and a
maximum fine of $5,000,000, when he is sentenced on August 28, 2019.
This case was investigated by the Federal Bureau of
Investigation and the U.S. Securities and Exchange Commission. Assistant U.S. Attorney Stephanie N.
Toussaint and U.S. Department of Justice Trial Attorney Andrew R. Tyler are
prosecuting the case.
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