SEC Charges Investment Adviser With Fraud
Investment adviser Stephen Brandon Anderson has been issued with a fine of $367,000 from the Securities and Exchange Commission (SEC) for defrauding clients.
Anderson owned and operated River Source Wealth Management, whose primary source of revenue came from customer advisory fees. Customer agreements specified that those fees would be based on each customer’s assets under management, however the SEC found that Anderson was in fact overcharging customers by around 40% on aggregate.
The SEC’s order prohibits Anderson from acting in a supervisory or compliance capacity, or from taking advisory fees without supervision, for at least three years. Anderson further agreed to pay disgorgement and prejudgment interest of $405,381 and a $100,000 penalty.
Commenting on the order, Carolyn Welshhans, Associate Director of SEC’s Enforcement Division said:
“When advisers breach their duty to clients by misleading and overcharging them, they can expect the SEC to craft a package of remedies that will compensate harmed investors, provide additional safeguards for prospective investors, and deter similar conduct.”