Pittsburgh investment manager charged with wire fraud, accused of diverting $3.7M

A Pittsburgh investment manager was charged in federal court on Tuesday with wire fraud, accused of diverting more than $3 million from a family’s investment fund.

Thomas R. Pipich Jr. faces one count of wire fraud. He was charged by the U.S. Attorney’s Office via criminal information, which typically means a defendant is expected to plead guilty.

Messages left with Pipich’s attorneys on Wednesday were not immediately returned.

The criminal charge comes more than a year after the purported victims in the crime, Berlekamp Family Investments, filed a federal lawsuit against Pipich over the same allegations.

That lawsuit remains pending.

According to the criminal information, Pipich helped create BarTom Investments LLC in 2005. It was through that entity, federal prosecutors said Pipich took money from Berlekamp.

The fund was started by Professor Elwyn Berlekamp, a math and computer science professor at the University of California, Berkeley, known for his work in coding theory. Among Berlekamp’s accomplishments, the lawsuit said, he pioneered algorithms that allowed spacecraft, including the Hubble telescope, to send visual images from the cosmos back to Earth.

In 2012, according to the civil complaint, Berlekamp was diagnosed with pulmonary fibrosis and given six months to live.

He established the investment fund to preserve and grow his family’s wealth for his three children, the lawsuit said.

Berlekamp hired Pipich to serve as the fund’s sole manager, according to the lawsuit. He met Pipich around 2000, when Pipich was providing investment advisory services to the National Academy of Sciences.

However, according to the criminal information, by May 1, 2017, Pipich had lost millions of dollars through BarTom.

Federal prosecutors allege that Pipich used funds from the Berlekamp fund to make up for the losses at BarTom over a period of six years — until 2023. He transferred $3.7 million from Berlekamp to BarTom during that time.

As part of the scheme, prosecutors said that Pipich created a fraudulent line of credit agreement for up to $2.5 million and forged another person’s signature on it. He also claimed that the loan was secured by a vineyard, when it was not.

The lawsuit alleged that Pipich covered up his actions by falsely representing to the Berlekamp family that the investments were providing “high returns” and generating good “cash flow.”

It also claims that when Berlekamp’s daughter confronted Pipich during a phone call about the financial irregularities in September 2023, Pipich admitted to taking millions of dollars.

Later, after he sat down with the Berlekamps’ attorney in January 2024, Pipich admitted he diverted the money from the family through a fake line of credit agreement to cover up what he was doing, the lawsuit said.

He also claimed during that meeting that he was unable to repay any portion of the funds.

The lawsuit includes claims for fraud, breach of fiduciary duty, conversion and unjust enrichment.