In the days since the Securities and Exchange Commission made fraud allegations public against Sean and Shane Hvizdzak, community members have reacted with stunned disbelief.
Perhaps Bradford Township Supervisor Jim Erwin best summed up the confusion many felt: “They seem like really nice kids. I’ve never heard a bad thing about those kids. They are very intelligent, never in any trouble.”
The SEC has alleged the brothers defrauded investors out of millions in a cryptocurrency hedge fund scheme, sending the investors’ money to their personal accounts rather than investing it. The brothers allegedly gave false reports of how well the fund was doing, claiming returns at or near 100%.
Shane Hvizdzak, 32, of Bradford, who has taught at both University of Pittsburgh at Bradford and St. Bonaventure University, and Sean Hvizdzak, 34, of St. Marys, a local attorney whose clients include the City of Bradford Board of Health, were both named in the SEC complaint, temporary restraining order and asset freeze publicly released on Friday.
While a list of investors has not been made public, the community is abuzz with names of people who allegedly trusted High Street Capital LLC to make them money.
While not involved in the case, William Chapman of Ameriprise Financial spoke to The Era in general terms of the trust placed in people who are handling one’s money.
He said he had heard of local people who mortgaged their home, or took out a second mortgage on their home, to invest with the Hvizdzaks.
“It’s the most awful thing I can imagine,” Chapman said. “I suspect a lot of people who had invested in this could not afford to lose the money. These folks will never recover from it.”
He theorized that many who invested with the brothers were likely older folks who invested their life savings. “They don’t have another 40 years to work to make up the money that has been lost,” Chapman said.
While people with greater financial means may not feel the pinch of the loss as acutely as those with less resources, the impact will be felt.
“I remember the financial crisis back in 2008,” Chapman said. He had watched an interview with media mogul Ted Turner, who had lost money. “He said, ‘This isn’t going to change my life any, but it’s going to change the amount I can give.’”
Local charities may take a hit as a result, Chapman theorized. “The most vulnerable people may be hurt.”
And if the allegations are proven true, the trust that is common in a small town will take a hit, too.
“It just tears at the fabric of a small community,” Chapman said. “Something like this, I don’t think anyone envisioned it occurring here.”
Erwin, supervisor chairman in the township where High Street Capital is located and a retired policeman, cautioned that people remember at this point, the SEC’s complaint against the brothers is merely allegations — nothing has been proven.
Neither Shane nor Sean Hvizdzak have responded to The Era’s requests for comment.