A complaint filed with brokerage regulators claims that William Sirls bilked millions of dollars from Wachovia Securities' clients in fraudulent stock and real estate transactions to feed a gambling addiction.
Mr. Sirls, 42, who is facing charges in U.S. District Court in Toledo for money laundering and mail fraud, was a branch manager and vice president of a Wachovia Securities office in Toledo until March, 2005.
Federal prosecutors said the scamming of clients and co-workers at Wachovia and others involved $17 million to $40 million and began in 2000 and continued until last September, nearly two years after Mr. Sirls resigned from the brokerage.
The complaint, filed on behalf of two investors who lost more than $2.5 million, alleges that the Grosse Ile, Mich., resident took funds from Wachovia clients and others in short-term trading and high-risk stock options to pay gambling debts.
The complaint, which was provided by the investors' attorney, Andrew Stoltmann, was filed with the National Association of Securities Dealers, the self-regulatory body of U.S. brokerage firms.
Mr. Sirls, a licensed securities dealer since 1990, allegedly lured investors into fictional and fraudulent schemes that promised big returns on stock trades and real estate.
The complaint said investor Ken Walker, 83, of Grosse Ile and Marco Island, Fla., lost $2.4 million of nearly $4.9 million in what he thought was being invested in real estate transactions in California.
But Mr. Sirls used the money in "what amounted to a giant, multimillion dollar ponzi scheme," the complaint said.
Mr. Sirls' Toledo attorney, Stephen Hartman, said that his client is a compulsive gambler.
"Bill does have a gambling problem, which, frankly, can be just as serious as a drug or alcohol problem," Mr. Hartman said.
In the complaint, Mr. Stoltmann, a Chicago securities attorney, alleges that irregularities in client accounts should have alerted Wachovia to the fraud, and that two Wachovia employees - Mark Schneider and Randy Hunt - profited in the real estate scheme.
Mr. Schneider is a senior vice president and Mr. Hunt is vice president of Wachovia's downtown Toledo office. Mr. Hunt took over the now-closed West Toledo branch after Mr. Sirls resigned.
"Wachovia did not protect their clients," Mr. Stoltmann said. "Both my clients maintained accounts with Wachovia through the present. Even after Mr. Sirls resigned, he continued this scheme with my clients."
A high school classmate of Mr. Sirls, Dennis Pousak, also is represented by Mr. Stoltmann in the complaint.
Mr. Pousak, a Northville, Mich., attorney, said he began investing with Mr. Sirls in November, 2005, in part, because of a friendship that began more than 25 years at Gabriel Richard High School, Riverview, Mich.
"Bill is a very gregarious guy. He is very smart. Bill was good at whatever he tried - from dunking the basketball to being a scratch player at golf. Anything Bill tried, athletically and academically, he excelled and exceeded with very apparent ease," Mr. Pousak said.
The complaint alleges that Wachovia officials began investigating the volume of trading in Mr. Sirls' personal accounts and issues in his personal life in the months before he left the company.
Mr. Hunt said yesterday that he couldn't comment on the allegations raised in the investor complaint.
However, he said that an internal investigation into Mr. Sirls has begun. "Beyond that, I cannot comment on the investigation," he said.
Mr. Schneider couldn't be reached for comment.
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