A Florida high school basketball coach who held himself out as an investment advisor to teachers and fellow coaches is now accused of running a Ponzi scheme. Robert Schnepp, a former basketball coach at Cypress Lake High School in Fort Myers, Florida, was arrested this week on thirty-seven felony counts including grand theft, fraud, passing worthless checks, and the unregistered sale of securities. Schnepp is currently awaiting a transfer to a Lee County jail.
According to the former athletic director at Cypress Lake High School, it was well-known that Schnepp was a financial advisor when he was hired in 2006 as the boy's basketball coach. Based on this reputation, Schnepp began offering to invest on friends and family's behalf, with several other coaches at the school also choosing to invest with Schnepp. Investors were provided with regular quarterly statements showing purported rises in their account balances. In total, at least 10 investors entrusted over $200,000 with Schnepp from 2008 to 2011.
Authorities allege that Schnepp ran the classic Ponzi scheme, using investor funds for personal expenses as well as the payment of fictitious returns to existing investors. Some became suspicious when, after asking for a return of their investment, Schnepp's check bounced. After three checks bounced, victims contacted authorities.
A quick search of the BrokerCheck service provided by the Financial Industry Regulatory Authority (FINRA), which offers information about brokers and firms registered with FINRA, shows that Schnepp was not employed in any securities capacity, and had not been licensed to sell securities since February 2006.
Schnepp's BrokerCheck is here.