Atlanta man accused of $3M investment fraud arraigned

An Atlanta investment adviser was arraigned Monday in federal court on charges that he defrauded clients out of $3 million, including allegations that he nearly wiped out the life savings of an elderly Alzheimer’s patient.

Frederick J. Barton, 48, faces charges of wire fraud, mail fraud and securities fraud. He was indicted by a federal grand jury Dec. 2.

According to the indictment, Barton founded his own investment advisory firm after being fired from national brokerage firm A.G. Edwards & Sons, where he worked as a manager.

Barton is charged with fraudulently diverting client funds to himself from at least 2001 to 2007. The indictment alleges that Barton diverted more than $1 million of a 90-year-old Alzheimer’s patient’s money after he learned of her diagnosis in 2001.

The woman, who died in 2007, isn’t named but is referred to as “R.F.” in the complaint. Federal prosecutors say the woman’s investment and bank accounts fell from about $1.3 million in 1999 to less than $100 in 2004.

The indictment also accuses Barton of fraudulently selling more than $1 million in shares in his new company, diverting at least half of the proceeds to pay off personal debts and for other expenses.

Barton also faces civil charges brought by the U.S. Securities and Exchange Commission. Both cases are in U.S. District Court in Atlanta.