Financial Advisor Used $4.3 Million To Defraud Clients

LAKE OSWEGO, OR — Former investment advisor Shayne Kniss is said to have used his clients as his own personal piggy bank, collecting more than $4 million from nearly 50 people over two years and using more than $500,000 of it for his own gains.

Kniss, a former resident of Lake Oswego, on Tuesday pleaded guilty to a wire fraud charge, which accused him of using his investment firm, Iris Capital Management Group, LLC, to defraud 47 people who invested $4.3 million into his funds between February 2011 and April 2013.

Kevin Sonoff, spokesman for the U.S. Attorney's Office in Oregon, said Kniss "commingled investor money among the funds, used new investments to make payments to prior investors, and used more than $500,000 for personal use, including investing in a retail marijuana enterprise."

Kniss, 42, was able to defraud his clients for so long by misrepresenting how he planned to manage the money he was being given, Sonoff said.

“Kniss treated these victims — and their savings accounts — like his personal ATM,” Oregon FBI Special Agent Renn Cannon, said in a statement. “If you — or senior citizens in your family — are considering investments of any kind, make sure you do your research. Only invest with reputable firms and, if the promised returns sound too good to be true, they likely are.”

Using brochures, emails, and personal presentations, Kniss passed his fraudulent scheme over numerous clients — many of whom were over 65 years old.

When he is sentenced Aug. 22, Kniss faces a max prison sentence of 20 years, with at least three years of supervised release afterward, and possibly $1 million in fines — twice the gross financial gain obtained through his crime, according to Sonoff.

“Investment advisors are legally required to act in the best interest of the clients," said U.S. Attorney for Oregon Billy J. Williams. "This defendant did the exact opposite."

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