Charles J. Dushek, Securities Fraud Scheme, IL 2024

Charles J. Dushek, 72, of Warrenville, Illinois, has been hit with a 10-count federal indictment accusing him of one of the most brazen securities fraud schemes in recent Chicago history. The self-styled financial guru allegedly ran a rigged trading operation out of his Lisle-based firm, Capital Management Associates Inc., where he funneled millions in profits to himself while dumping losing trades on unsuspecting clients.

According to the indictment unsealed Wednesday in U.S. District Court, Dushek placed over $400 million in securities trades between July 2008 and August 2012 without declaring in advance whether the trades were for his personal accounts or his clients’. He then waited up to five days—long enough to see which trades paid off—before allocating winners to himself and losers to client portfolios. The scheme netted him more than $1 million in illicit gains.

The purchases included major blue-chip stocks like Walgreens, Avon Products, British Petroleum, Caterpillar, and PepsiCo. Dushek kept detailed spreadsheets tracking which trades he would assign to which account—manipulated after the fact to maximize his personal windfall. The indictment paints a picture of cold, calculated deception at the expense of retirees and investors who trusted him with their life savings.

Dushek, president of his firm for years, now faces nine counts of securities fraud—each carrying up to 25 years in prison—and one count of employing a scheme to defraud a client, which carries a maximum five-year sentence. His arraignment is set for Dec. 20, 2016, at 9:30 a.m. before U.S. District Judge Virginia M. Kendall.

The case was announced by Zachary T. Fardon, U.S. Attorney for the Northern District of Illinois, and FBI Special Agent-in-Charge Michael J. Anderson. The U.S. Securities and Exchange Commission, which previously filed a civil suit against Dushek, provided key evidence in building the criminal case. Assistant U.S. Attorneys Rick Young and Kruti Trivedi are leading the prosecution.

Federal authorities stress that an indictment is not a conviction—Dushek is presumed innocent until proven guilty. But if convicted, the court will impose a sentence under federal guidelines that could put the 72-year-old behind bars for decades. For now, the fall of Charles J. Dushek stands as a grim lesson in betrayal dressed as financial advice.