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Detroit Money Manager Bluestein Barred From Securities Industry

Detroit Money Manager Frank Bluestein Barred from Securities Industry, Ordered to Pay Millions for Role in May’s Scheme

Detroit money manager Frank Bluestein has been barred from the securities industry and ordered to pay $4.4 million for his alleged role in Edward May’s massive Ponzi scheme.

Edward May, founder of E-M Management Co. LLC (E-M), pleaded guilty to 59 counts of fraud in 2011 for cheating investors across the nation out of $35 million in a Ponzi scheme. May told investors that his companies held telecommunications contracts with several major hotel chains that guaranteed income of $30,000 - $100,000 per month to each company.

The contracts never existed. May misappropriated funds and used new money to pay earlier investors. As many as 1,200 investors lost their life savings when the scheme collapsed.

May was indicted in 2009, after an SEC complaint claimed he had solicited $250 million in fraudulent investments. According to the SEC, Bluestein was the single largest salesperson in May’s scheme. He allegedly raised around $74 million from more than 800 investors by misrepresenting the securities as safe.

Bluestein has admitted to selling and receiving commissions and referral fees for selling unregistered Edward May securities, but he has denied knowing that the securities were fraudulent. As of now, he has not been charged with any crimes.

The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

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