A Hermosa man is charged with federal wire fraud after allegedly running an investment scheme that made him $75,500 but caused a client to lose $509,337.06.
David Ward Astin, 36, was arrested Oct. 22 in Houston, Texas, and transported to South Dakota. He is detained at the Pennington County Jail.
Court documents say the scheme began in 2012 when Astin entered into an agreement to manage foreign currency exchange accounts — aka “forex” accounts — belonging to Dr. David Blickensderfer. Forex trading involves trading currencies of different countries against each other, court documents say.
“As part of the scheme and artifice,” says the indictment in the case, “Astin began providing false information to Blickensderfer about the balances in Blickensderfer’s forex accounts to make Blickensderfer believe his forex accounts were making significant gains when in reality the accounts were losing substantial amounts of money.”
Astin allegedly sent an email and text messages to Blickensderfer that included false representations of ending balances for the forex accounts. Astin also allegedly provided the doctor with falsified Forex.com account statements that showed higher account balances than actually existed in the accounts. Astin allegedly used the altered statements to hide losses resulting from his trading.
The indictment says Astin caused the doctor to make 19 financial transactions totaling $806,997.86 to fund the forex accounts. Blickensderfer also made direct and indirect payments totaling $75,500 to Astin as compensation for Astin’s services, the indictment says, while Astin’s trading allegedly lost $433,877.06.
Astin was indicted more than two years ago on May 24, 2016. A warrant for his arrest was issued the next day.
At the time, a federal prosecutor requested the case be sealed from public view, and a judge granted the request. The motion to seal the case said, "the Defendant has left the United States in order to avoid prosecution and is most likely monitoring the investigation in order to avoid law enforcement."
The case was unsealed on Oct. 23 of this year, the day after Astin’s arrest in Houston.
Astin’s attorney, Paul Andrews, declined to comment. Attempts to reach Blickensderfer were unsuccessful.
Astin had his initial court appearance Monday at the federal courthouse in Rapid City and pleaded not guilty. U.S. Magistrate Judge Daneta Wollmann ordered Astin to remain detained, citing a serious risk that he would not appear for future court proceedings.