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Parents of Wall Street Whiz Kid Sued for Money He Spent on Them

February 18, 1989

NEW YORK (AP) _ The parents of convicted Wall Street whiz kid David Peter Bloom were sued Friday for $191,250 he allegedly spent on them from $15 million bilked from investors and diverted to a lavish lifestyle.

Bloom, 24, is serving an eight-year prison sentence after pleading guilty last year to one count each of mail fraud and securities fraud.

He was sentenced in December and ordered to return the $15 million prosecutors said he conned mostly from friends of his parents and used to buy expensive art, luxury cars and posh homes.

The suit, filed in federal court in Manhattan by the receiver of Bloom’s claimants, alleges that Bloom lent his mother, Lois, at least $156,000 and his father, Daniel, $10,250, and paid for $25,000 in trips to Europe, the Caribbean and the Super Bowl and meals for one or both of them.

″The funds...came entirely from monies entrusted to Bloom for investment purposes and diverted to his personal use,″ the suit alleges.

The suit was filed by Irving H. Picard as receiver for Bloom and Greater Sutton Investors Group Inc., of which Bloom was sole shareholder. The receiver said he is trying to locate and repay the 100 people Bloom defrauded.

Karl Lowenthal, attorney for Bloom’s parents denied the allegations.

″Their kid’s in jail. They’re distraught. They’re bankrupt from defending him,″ Lowenthal said. ″This money was never given to them. This is a strange thing. ...It might be purely imaginary.″

Picard said about $3.1 million, or 25 cents on the dollar for $12.9 million worth of investments, already had been paid and more money would be forthcoming after all lawsuits are settled.

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