When asked about the millions of dollars missing from his clients’ accounts, Michael J. Park, a Brentwood, TN stockbroker, didn’t offer much of an explanation.
At a bankruptcy meeting yesterday, Park plead the fifth amendment and refused to answer questions about what happened to the money. A lawyer representing investors in the case says Park is most likely waiting for law enforcement investigators to offer him sentencing deal.
The case against Park was sparked after he sent letters to investors recently saying their accounts were frozen and his office shut down by “compliance officers.” The letter said: “your account held with Park Capital Management Group has no current liquid value,” but went on to suggest that investments held with his brokerage, 1st Discount Brokerage in West Palm Beach, Fla., were still available, according to one local newspaper.
Park attempted suicide after shutting down his office and filed for bankruptcy. One lawyer familiar with the case says filing for bankruptcy is a good way to pay back creditors. “If you pay some of your money back, there’s also a chance of getting a better sentencing deal from investigators,” he says.
So while the FBI and SEC attempt to figure out exactly how much money Park lost (some say upwards of $20 million) and what he’s done with it, his clients await the results of his bankruptcy hearing. “He’s not going to tell anyone what happened to the money at the bankruptcy hearing until he’s offered a deal,” the lawyer says.
William Cheek, a Nashville-based lawyer representing five investors, says Park met many of his clients at an upscale golf club. “He was setting them up with stocks and mutual funds, and then gave them statements showing fake appreciation,” he says. In one instance, a client invested $300,000 with Park and was shown a statement that valued his account at $600,000, he says.
Park is registered with 1st Discount Brokerage in West Palm Beach, Fla. Edward Jones and Raymond James Financial both fired him, in 1998 and 2000, according to FINRA.
Park’s lawyers did not respond to request for comment.