Twin brothers Adam and Daniel Kaplan, of Great Neck, convicted of defrauding investors out of $5M while acting as financial advisers

A Long Island federal jury convicted Great Neck twins Adam and Daniel Kaplan on Thursday for using their role as financial advisers to steal as much as $5 million from their clients — some elderly and disabled — by overcharging brokerage fees and illegally diverting funds.

Daniel Kaplan was cleared on two charges of money laundering but found guilty on the remaining 15 fraud charges. His brother, Adam, was convicted on all 21 counts, including witness intimidation and attempting to bribe a federal investigator after an eight-week trial.

"Adam and Daniel Kaplan lied to their victims about fees to steal money," federal prosecutor Adam Toporovsky told the jury at closings. "Adam and Daniel Kaplan stole money directly from their victims' bank accounts. Adam and Daniel Kaplan stole money straight from victims' lines of credit, too, and Adam and Daniel Kaplan lied, and lied, and lied to cover it up. They forged signatures and they created completely fake documents so that they could keep the stolen money."

Prosecutors presented the jury with record after record spanning from May 2018 to July 2021, showing bank withdrawals and deposits, with account numbers, addresses, emails and phone records matching the Kaplan brothers' accounts. They also showed text messages from the brothers’ clients, questioning their balances and the fees they’d been charged, then deposits to the brothers’ accounts identical to the missing money.

The assistant U.S. Attorneys on the case also offered carbon copies of checks as evidence that they said were doctored to boost the Kaplans’ brokerage rates by thousands of dollars.

The twins, who worked for IHT Wealth Management after leaving Morgan Stanley and Merrill Lynch under federal scrutiny, would submit blank brokerage agreements for accounts with fees that were sometimes four times what they told their clients.

In all, prosecutors say, the brothers overcharged $540,000 on advisory fees and used client money for personal expenses, charged client credit cards and withdrew funds from the clients’ bank accounts without permission.

After they were fired by IHT and the Securities and Exchange Commission launched an investigation into their actions, they hired Todd Blanche, a former personal lawyer for Donald Trump, currently a high-ranking Justice Department official. When they were unhappy with Blanche’s representation, the Kaplans sued, claiming he had forged their signatures on legal retainer documents. The case is still pending in Manhattan Supreme Court. The brothers also sued two of their 50 victims for libel after they complained to authorities about the scam.

According to court testimony, the brothers befriended an elderly woman with dementia and even drove her to the bank so she could sign papers authorizing them to withdraw her money.

"What was Adam Kaplan doing between 2020 and 2022 while [the victim] was cognitively impaired, while she was hallucinating? He was stealing hundreds of thousands of dollars from her," Toporovsky said during closing statements.

While under indictment for overcharging brokerage fees, federal prosecutors said Adam Kaplan hatched a plan with Ronald Roth, a compulsive gambler with a decades-long criminal record, to defraud clients with a flower business investment scheme.

Roth convinced Adam Kaplan he could make his federal indictment go away by hiring a former Israeli Secret Service agent to intimidate victims and dig up dirt to blackmail federal officials involved in his case.

Roth got Kaplan to pay him more than $100,000 to send organized crime members to the houses of the victims and send them a skull and crossbones, prosecutors argued. But Roth made it all up and pocketed the money to fuel his addiction.

"I’m a compulsive gambler," Roth told jurors during the trial. "I gambled most of it away."

He pleaded guilty to wire fraud charges for his scheme against Kaplan.

Attorneys for the brothers, Mark S. Cohen and Michael Tremonte, said they will appeal the verdict.

"We respect the jury’s verdict, but we are deeply disappointed by the outcome," the lawyers said. "Adam and Daniel Kaplan maintain their innocence and will continue to vigorously fight the charges against them."