September 13, 2012

CT broker accused of bilking $600K from clients

State and federal securities regulators accuse a Connecticut stock broker of stealing at least $600,000 from clients, including fellow churchgoers, to pay his mortgage and other personal and business expenses.

The Connecticut U.S. Attorney's Office said Thursday it filed criminal charges against Stephen B. Blankenship. The U.S. Securities and Exchange Commission separately has filed a civil suit against Blankenship and his Deer Hill Financial Group in Danbury.

Meantime, authorities say the Connecticut Banking Department's Securities Division has revoked licenses for both to do business in the state.

According to investigators, starting around 2002 Blankenship began persuading customers to withdraw money from brokerage accounts he managed at other securities firms and invest directly with him.

He lured about a dozen customers, including retirees and others he met at church, authorities say.

Some of the money he collected was allegedly used to repay other investors in a Ponzi-like scheme, investigators say. The rest allegedly went to pay his mortgage, travel, and grocery bills among other personal expenses.

Blankenship could not be immediately reached Thursday for comment.

A phone listing for Deer Hill Financial was disconnected.

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