ST. LOUIS • A former University City stockbroker and a Chesterfield mortgage company owner were indicted Thursday on federal fraud charges for allegedly stealing millions of investors' money.
Prosecutors say former Woodbury Financial Services, Inc. broker Joshua Gould, 31, and David Rubin, 47, owner of Coral Mortgage Bankers Corp. embezzled roughly $1.5 million from one couple's life savings.
Rubin took some of the couple's initial $1.2 million investment for his salary and to settle a sex discrimination lawsuit, then passed the rest to Gould, prosecutors say.
Prosecutors say Gould went on to steal $3.5 million more from "numerous" clients, trading and selling their investments without their knowledge and setting up two shell companies to dupe clients into believing they were legitimate investments.
Gould used the money for car, mortgage and credit card payments, home renovations, and "substantial expenses" at strip clubs, prosecutors say. He also used the money to start several businesses, including The Sports Nook, a sports ticket reseller, True Hockey and Free Poker Experience, and to pay other clients to hide the thefts.
Gould now faces one count of mail fraud and one count of mail fraud. Rubin faces one count of wire fraud.
Rubin referred a reporter to his lawyer, who could be immediately reached for comment.
Gould's lawyer, Al Watkins, has been talking to the media about the case for more than a month, giving a slightly different version of events. On Thursday, he told the Post-Dispatch that Gould began taking money from other sources when he was unable to meet a mandated rate of return for the investor who lost $1.5 million. He then began taking money from a family trust and then other clients, Watkins said.
Nearly all the victims are from the local Orthodox Jewish community, Watkins said, including Gould.
The fraud began unraveling when an investor had a question on their statement, "and Josh didn't have an explanation of where money had gone," Watkins said.
"Mr Gould has. . . acknowledged responsibility, assisted the federal authorities and put himself in harm's way to ensure that everything he could possibly do to right this wrong was done," Watkins said.
Gould now is dancing at the corner of Laclede Station and Watson roads in a Statue of Liberty costume promoting a nearby tax service, Watkins said. "He's trying to pay everybody back."
Woodbury's legal department did not return a call sekking comment.
Assistant U.S. Attorney Hal Goldsmith, who is handling the case, declined to comment except to say, "It is inappropriate for counsel to comment on a pending court matter."
When it comes to money matters, it is important that we know where we are putting it. It is best to regularly check it, even if we know the people handling it. To make it is safe better have papers and proof of the flow or growth.
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