On May 28, 2019, the SEC charged Stephen Brandon Anderson with defrauding clients by overcharging advisory fees of at least $367,000. According to the SEC’s order, Anderson owned and operated River Source Wealth Management, LLC, a now-defunct registered investment adviser in North Carolina. River Source’s primary revenue stream was customer advisory fees. Customer agreements provided … Read More
On May 28, 2019, the SEC charged Sean Premock with devising a scheme to defraud investors and obtained money and property by means of false and fraudulent pretenses, representations, and promises. The indictment alleges that Premock raised approximately $1.3 million from his clients by making numerous misrepresentations, including that the clients would earn high rates … Read More
On May 23, 2019 the SEC issued a risk alert on safeguarding of customer information stored on cloud and other network storage solutions. The Risk Alert identifies security risks and best practices associated with the storage of customer records and information by investment advisers and broker-dealers (collectively, firms) in the cloud and on other electronic … Read More
On May 23, 2019, in recognition of the one-year anniversary of the passage of The Senior Safe Act, the Securities and Exchange Commission, the North American Securities Administrators Association (NASAA), and the Financial Industry Regulatory Authority (FINRA) have issued a fact sheet to help raise awareness among broker-dealers, investment advisers, and transfer agents of the Act and … Read More
On May 6, 2019,  Corinthian Capital Group, LLC, Peter B. Van Raalte, and David G. Tahan settled an enforcement action. From at least April 2014 to February 2015, Corinthian misused the assets in a private equity fund, Corinthian Equity Fund II, LP (“CEF 2”) that it advised to the advantage of Corinthian and three of … Read More
On April 23, 2019, the SEC charged a formerly SEC-registered investment adviser CCM and its principal’s investment of $4 million on behalf of two funds they managed. In mid-August 2016, CCM and its founder and chief executive officer Bruce made a $4 million loan on behalf of the two funds to a Norwegian individual and … Read More
On April 19, 2019, the SEC charged Prosper Funding LLC with miscalculating and materially overstating annualized net returns to retail and other investors. According to the SEC’s order, from approximately July 2015 until May 2017, Prosper excluded certain non-performing charged off loans from its calculation of annualized net returns that it reported to investors. The order finds that, as a result, … Read More
On April 16, 2019, OCIE issued a risk alert in connection with issues OCIE identified during examinations in the past two years regarding Regulation S-P. The key takeaways from the alert are for advisers to review their written policies and procedures, including implementation of those policies and procedures, to ensure that they are in compliance … Read More
On April 9, 2019, the SEC charged a former senior lawyer at SeaWorld Entertainment Inc. with insider trading based on nonpublic information that the company’s revenue would be better than anticipated for the second quarter of 2018.  The SEC alleges that Paul B. Powers had early access to key revenue information as the company’s associate general counsel and assistant … Read More
On March 28, 2019, the SEC filed charges against the former chief operating officer (COO) of a Commission-registered investment adviser for aiding and abetting the advisory firm’s actions to overbill its clients as part of a fraudulent scheme to improperly inflate his own pay.  According to the SEC’s complaint, between 2011 and December 2018, former COO Richard T. Diver, … Read More