SEC Charges a California CPA with Stealing Millions in a Ponzi Scheme

Mar 25, 2019

On March 20, 2019, the Securities and Exchange Commission charged Carol Ann Pedersen, a CPA from Long Beach, California, with stealing millions of dollars from investors in a Ponzi scheme. At the time of her fraudulent scheme, Pedersen operated her own accounting firm where she provided accounting services to individuals and families in Southern California.  She acted as an investment adviser to certain clients, although she has never been registered with the SEC and has never held any securities licenses.

The SEC’s complaint, filed in federal district court in Los Angeles, alleges that from 1991 to 2017, Pederson raised at least $29 million in investments from her clients falsely promising to invest in securities. For some, Pederson promised to invest their money in “federally guaranteed” securities with fixed rates of returns of 8% or more. She also solicited investments in a limited partnership she managed called the C.A. Pedersen Client Investment Pool.  Pedersen claimed that the limited partnership owned a large and diverse stock portfolio.

Pedersen did not invest the funds that she received from investors. Instead, Pedersen deposited investor funds in a single bank account and used the funds to make distributions to existing investors and to pay for personal expenses. Pedersen concealed her fraud by providing clients with fake account statements showing a return on their investments. By 2017, her scheme unraveled when she did not have enough cash to make regular or requested distributions to investors.

Pedersen settled with the SEC and agreed to an entry of a final order whereby she consented to injunctive relief and to be liable for approximately $2.7 million in disgorgement and interest. The settlement is subject to court approval. A copy of the SEC’s complaint can be found at

In a separate action, the U.S. Attorney’s Office for the Central District of California has brought criminal charges against Pedersen arising from the same conduct.

If you believe that you have been a victim of securities fraud, please call the Costello Law Group at 410-832-800 (or Toll Free 877-418-0003) for a free consultation.


Submit a Comment

Your email address will not be published. Required fields are marked *