The Securities and Exchange Commission (SEC) has initiated a lawsuit involving alleged financial misconduct against an individual and two corporations. Filed in the Southern District Court of Florida on May 28, 2025, the complaint claims that, over a timeline spanning from May 2015 to April 2024, a total of approximately $17.3 million was misappropriated from 40 clients under the guise of investment advice.
During the specified period, the individual purportedly advised clients to invest in various funds that he claimed to manage, as well as in other financial securities. He reportedly abused the trust ingrained in his role as an investment adviser, leading clients to deposit around $39.7 million into accounts he controlled. The complaint indicates that he misappropriated funds from these accounts for personal use, making Ponzi-like payments totaling $7.8 million to select clients and other investors as part of a fraudulent scheme.
The SEC outlines that the conduct described constitutes violations of multiple sections of federal securities laws, including those pertaining to the Securities Act of 1933 and the Securities Exchange Act of 1934, as well as the Investment Advisers Act of 1940. The Commission argues that, without intervention, the defendants are likely to continue violating these laws. Consequently, the SEC is pursuing injunctive relief, the return of ill-gotten gains along with interest, and the imposition of civil penalties. Further, they are seeking a permanent injunction to restrict future conduct by the individual involved.
The two corporations identified in the lawsuit, both based in Florida, served different operational purposes during their respective existence. One corporation was active from February 2017 until its administrative dissolution in September 2024, primarily functioning as a holding company and providing consulting services. The other corporation was established in April 2010 and was engaged in investment advisory services until it also faced administrative dissolution in September 2024. Notably, both companies were led by the same individual throughout their operations.
The investment advisory firm was registered with the SEC until January 2021 and had provided portfolio management and advisory services during that period. In a separate incident in September 2020, the firm and the individual agreed to an administrative resolution regarding allegations of improper performance fees and misrepresentations about client asset safety, without admitting fault.
The individual involved in the lawsuit, now aged 62 and residing in Fort Lauderdale, has a career spanning over three decades in global asset management and held a relevant professional license. However, his history includes legal challenges, as he was charged with first-degree grand theft in June 2024 and has entered a not guilty plea.
As this case unfolds, it marks a significant regulatory action aimed at safeguarding investor interests and reinforcing adherence to securities laws designed to promote trust in the financial advisory sector. The SEC’s firm stance emphasizes the importance of compliance and accountability in matters of financial management and investment advisory practices.