There’s comfort in knowing I wasn’t the only one.
“Small fry” is the category I’ll be filed under in the San Francisco Bankruptcy Court proceedings. But there’s a story here of massive fraud, committed, ok, allegedly committed over many years. My wife and I were caught up in this along with many others, some individuals stating claims as much as $7.2 million. The Summary of Schedules runs to 54 pages with just one page, by example, listing ‘loans’ of $13 million; even the IRS is out $1.5 million.
As is often the case with scam artists, we had high times together. He was a clever defense attorney and we won several legal battles together. The celebrations were so sweet; he was a genius and we were elated. I learned a lot from Jim; I’d never set foot in a court room except to adopt my two boys and now when the family was threatened, I felt vulnerable. James Jay Seltzer knew this, as I imagine he did with many others who also felt this way; he began to work his fraud.
At the Blue Water Grill with James J. Seltzer
We were referred to him by our family therapist; talk about a trusted source, but now we know this therapist was defrauded, too – to the tune of a million dollars. Our therapist died of a sudden illness just a few years ago. Categorize this under “small world”: a neighbor 2-doors away is the Executor and has tallied the losses – the estate is devastated.
Seltzer has since been disbarred for “major misappropriation of client funds”, but it’s a little too late. We learned of all his alleged misdeeds as we were named in bankruptcy proceedings. At the time we had no idea of the extent. It’s breath-taking, as you’ll soon learn, the number of plaintiffs and the amounts they are owed.
I’ve learned this story from the ending and now I piece it together with threads from the beginning. Last night my wife reminded me that as recently as this summer we received an email titled, “Good news.” What was he thinking? He knew we didn’t know the extent of his deceptions, but soon it would all unravel. Maybe not all, because there’s so much money missing, it must be stashed somewhere. Maybe it’s stashed in the Philippines, where Jim claims to be, due to health reasons. I doubt he’ll be returning home to the U.S. any time soon.
He called me about 6 weeks ago, via land line even though we had exchanged Skype account names. Jim must have known that Skype can be recorded; I do that every day. He was defensive about the disbarment, “No one lost a dime in that case.” And I didn’t at that time even know one tenth of the extent of his alleged transgressions; I didn’t even know it involved anyone losing money. I do now.
We are involved only to the tune of $25,000, a typical investment amount for a Tech Coast Angel here in Los Angeles. We’re coached to make modest investments and keep ‘dry powder’, cash in reserves, for when the start-up comes back for more, and they always come back for more. Instead of 6 figure checks like I used to write before joining a professional angel group, I’ve learned the value of diversification – being in many deals is better than having large positions in only a few early-stage deals. Jim took the time to learn all these details and I would happily share my angel investor investment philosophy. What else would we talk about? The possible outcome of the appearance in front of the judge at Court? I happily blabbed about deals I’d done and the size of the checks I was comfortable writing. Jim was a good listener.
When we first learned the extent of the fraud, and we didn’t know much then – we laughed. We had lost our investment, maybe not all of it we hoped, but the extent of the fraud, the wild times, the ups and downs of our relationship with Jim – it seemed a little comical. As an angel investor I’ve written off over 70% of all my early-stage investments. What’s one more? But this one is singular in the way Jim worked his way into our lives, into our hearts and the massive fraud he’s apparently committed on many he came in contact with, over many years.
He’s my own Bernie Madoff.
Next: “Springtime for Hitler”, Seltzer-style.